Learn why a business needs to set goals, what makes a good goal, and how to determine goals using the SMART framework.
- Goals affect behavior and job performance.
- They are a better source of motivation than monetary benefits alone.
- Employee engagement is higher when goals are in place. This reduces turnover and improves productivity in the workplace.
- When goals are mostly specific and challenging, the team's performance is heightened.
Setting goals is a common practice. All businesses around the globe come up with certain sets of goals to work toward. However, it is easy for small businesses to mistake vague ideas for a goal. To circumvent this, we must first understand why we have to set business goals.
Besides the benefits we get from achieving a goal, the goal-setting process in itself will help give a more detailed and organized understanding of a company and its employees' capabilities.
On top of that, good goals help employees limit stress, maintain focus, and make efficient use of time and resources. This protects them from overextension and lessens the possibility of great losses or setbacks.
Here are some things you should consider when setting your business goals.
What makes a good goal?
While goals are made to be accomplished, this does not guarantee a good goal. Great goals have a purpose. A business's purpose is to create profit. Expanding outlets for growth and cutting costs are some possibilities to achieve this, but these goals are rather unclear – more like vague directives that can be formed into business goals.
So how do you turn these into viable business goals? Using the SMART goal strategy, any idea can be set into motion or realigned to suit your company's needs. A mnemonic for goal-setting basics, SMART helps you prioritize and create concrete plans for your goals. These are the concepts it stands for:
S – specific/significant
Your goals have to be well defined. Ask yourself the "W" questions to help make your goal more specific:
- Who is involved in this goal?
- What do I want to accomplish?
- Why do I want to achieve this goal?
- Where should I implement this goal?
- When should this goal be completed?
Once you have answered these questions, you can check the rest of the sequence to verify the appropriateness of your goal.
M – measurable
For you to know whether you have accomplished your goal or if it has made a difference to your business, it must be quantitative in nature. Although changes can be seen and felt, numbers show the extent of a goal's effects.
This aspect of a goal allows you to make adjustments and improvements to your processes. A great reason to make a goal measurable is that the numbers will tell you if you are successful or not. If you are successful, you can keep going; if not, you can make a new goal and dig into why you didn't achieve it the first time.
A – attainable
It is good to dream big but plan small. Setting extremely high and unattainable goals can be detrimental to you and your employees. Although higher standards pose a challenge, if they are too difficult to complete, this could create feelings of self-doubt and ill will.
To set attainable goals, you can determine your standard by computing the average numbers from your previous performance and outputs. If this proves to be too low, you can raise the bar higher.
R – relevant/realistic
Think of your time and resources. Any goal is attainable if it is within your control. But is it realistic?
To determine this, you must ask yourself if your goals are within reach. This means that you have the time, resources and energy to fully commit to achieving this goal.
T – timely
Goals that drive results have a sense of urgency. A start and finish date gives people a timeframe to work within. For a business, this is especially important. Not only does it help you organize your projects and plans, but it also shows your clients, employees and suppliers that you value their time as much as your own.
How do you determine or formulate your goals?
Although SMART can help you assess how good your goals are, the sequence won't serve you that well if you cannot come up with the right goals for your business. SWOT analysis, a high-level strategic planning model, can help you with that.
SWOT stands for "strengths, weaknesses, opportunities and threats." It allows you to understand which projects you should jump into, which areas you must safeguard, and which you must improve or work on. Upon identifying these areas, you can create goals for improvement, security or stability.
Let's say, for example, your delivery services are either too slow or too occupied to cater to every customer's needs. You could make it your goal to find a better, faster way to get to customers, or to standardize your offering to appeal to the majority of customers as opposed to every single need.
Do you need to reassess your goals?
While these strategies are helpful, you may already have goals of your own. If they align with what you want, there's no need to reevaluate your business plans.
However, this is not the case in unforeseeable events such as a recession, natural calamities or a pandemic. Rarely does the economy hold up in the event of a global crisis. In fact, a pandemic can (and has) put many companies out of business.
Big corporations fight through it by repurposing their expertise to cater to the needs of the public, environmental and commercial sectors. They are able to do this by leveraging what they already have or are good at.
Small businesses do not have that luxury. Setting goals for growth and expansion, they focus more on building than safeguarding. While many do set resources aside for setbacks, it is rare for small businesses to have the skills, power and money to sustain their goals during a pandemic.
If you find yourself in this situation, do not fret. You can reassess your goals to determine whether you should change or postpone them. Also, you can change your frame of mind to incorporate better goals. Here are some things you can focus on.
Performance over outcome
Your output should determine the effects of your efforts. If this were to be made into a goal, it would be very hard to attain. A pandemic would make it even more so.
With the current limitations on physical contact, business hours and movement, your sales and transactions would definitely decrease. Instead of working toward an uncontrollable and uncertain result, why not focus on what you can do?
Small operational goals for longer periods
The bigger the plan, the bigger the demands. The constraints of a pandemic can make it hard to keep up. Make your goals small but meaningful. Over time, these little successes will add up to something big.
Small operational goals could include expanding your courier database, establishing rapport with clients and potential customers, and meeting an average number of sales in a week.
Opening your doors to online marketing and transactions
The business world is evolving, and you should too. If you do not have an online presence, it isn't too late.
With so many people staying at home, this is a great opportunity for you to learn the ropes of promoting your products and brand online. The more attuned your content is to your audience, the better your chances of gaining a fan base and loyal customers. Also, you can encourage customer engagement and use this as a means for future objectives.
In conclusion, for small businesses to set goals during a pandemic, they should review the SMART goals framework, set goals based on their strengths and weaknesses, and reassess goals to reflect current realities. Although setting and tracking goals can be difficult, it is worthwhile to keep your business focused through a difficult time. Businesses that set goals will have more engaged staff, happier customers, and better long-term outcomes than businesses that do not have specific goals.