How Companies Need to Set Their Business Goals

by Chris Rhatigan on Oct 26, 2016 8:00:00 AM

Goals

It’s common knowledge that good business leaders set goals and find ways for their companies to meet them. Investors and employees are much more likely to believe in a company that accomplishes what it sets out to do. Often we focus on strategies to meet those goals, but this only works if the goals are valid in the first place.

Creating a clear vision of what you want your business to be is crucial. It’s a matter of designing short- and long-term goals that help you arrive at that point. Then, perhaps even trickier, you have to make everyone in your organization believe in those goals.  


Not Just About Profits and Sales

Companies should have long-term growth targets. But they need to go beyond that. To gain employee buy-in and market share, it’s mission critical for businesses to have other big goals.

For example, your company could focus on improving customer relations. Or your company could play a larger role in the community. Whatever it is, finding the meaningful impact you want your company to make is essential for designing valid goals. These objectives should be tied to your companys mission and culture. 


Long-Term Goals

Salesforce CEO Marc Benioff said that “most people overestimate their success in one year and underestimate their success in ten years. For me, five-year goals are standard practice.”

A company’s long-term goals should be initiatives that take longer than a year to complete. They could even include game-changer goals. For example, Apple completely reimagined the role technology would play in people’s lives. However, keep in mind that these kinds of goals can be affected by external factors, such as a downturn in the economy.

Goals

 

Short-Term Goals

Each of your long-term goals should be supported by short-term goals. SMART isn’t a new concept, but it is a helpful one for creating meaningful objectives. You want your short-term goals to be specific, measurable, action oriented, realistic, and time specific.

If you want to boost sales by 36% over the course of a year, set each month’s goal to boost sales by 3%. This is an achievable, reasonable goal that employees can take action to accomplish. The goal has a clear, bright line too — either sales increased by enough or they didn’t.


Accountability

The reality is that goals are meaningless if everyone in the company isn’t held accountable for meeting them. This doesn’t mean you should go around firing people because they missed their goal one month. It does mean that leadership should be monitoring employees to see if they’re meeting the company’s objectives. When they’re not, it’s time to have an honest discussion about what they need to meet those goals.

Your company’s goals are ultimately tied to its culture. If you set substantive big objectives that are logically supported by interim goals then hold people responsible for meeting those standards, your company will be on the right course. It will also be more likely to survive in today’s competitive climate.

 

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This post was written by Chris Rhatigan

Chris Rhatigan is a freelance writer and editor. He is a former newspaper reporter for The New Haven Register and The Iowa City Press-Citizen. He enjoys playing old video games, studying (and trying to speak) Hindi, and walking his dog on the local trails. He lives in India.