Do you ever wonder how some people succeed at everything? The answer is simple; they make a plan and set goals.
Goal setting is key to success. The tricky part is knowing how to set the right goals.
When setting goals for your business, it’s important to remember where you’re headed and why. You want your goals to align with the overall vision of your company. Your vision should act as your north star, and your goals should all be to improve the company’s overall performance and in pursuit of that end destination.
If you don’t already have a clear vision or feel yours is outdated, it might be time to take another look.
Now, for goals to be powerful, they should be designed to be SMART.
Yes, you’ve probably heard of SMART goals, but if you’re not putting them into practice, you could be missing out on a big opportunity.
SMART goals help you turn a vague idea into an actionable plan for results. A quick example of this is how we look at our current goals. As business owners, we all want to “get more business,” but to achieve more business, we need to set goals that are measurable and easy to track. For that reason, a goal to “Increase revenue by 20% in 6 months” (for example: through increased sales) is easier to measure than “grow revenue”.
What Are SMART Goals in Business?
When you’re creating your SMART business goals, make sure to put thought into each of the following areas to set yourself up for success.
When setting goals, you must be specific about what you are trying to accomplish. When a goal is clear and well defined, it erases any ambiguity and establishes a clear direction for the goals. Specific objectives are easy to follow and can draw a straight line to where you want to end up.
Identify the metrics you want to use to track your goal. When you include precise amounts, dates, etc., your goal becomes more tangible and gives you a way to measure progress.
If you define your goal as “reduce expenses”, how will you know when you’ve been successful? Connecting metrics to your goals helps you measure success and allows you to celebrate those wins along the way.
Set goals that are realistic. It’s important to set your sights high, but when you set an impossible goal, it can feel hopeless and overwhelming.
By setting challenging yet realistic goals, you inspire motivation over discouragement. To ensure you’re not setting yourself up for failure, consider how to accomplish the goal and if you have the tools/skills needed. If not, what would it take to attain those skills? Move forward from there.
Goals should be relevant to your overall objectives. This seems obvious, but so often, we work towards goals that don’t move us closer to our vision. By keeping goals aligned with your vision, you’ll stay focused enough to move the needle vs spending time working on something that only distracts from your end destination.
Your goals must have a deadline. This cannot be stressed enough. By leaving your goals open-ended, you’ll lose any sense of urgency. If you’re working on a long-term goal, consider breaking it into smaller chunks to feel that sense of accomplishment and to keep up the urgency.
Why Setting SMART Goals Is Important for Your Small Business
In today’s competitive business landscape, it’s not enough for you to simply declare that you want to increase your turnover or open two new office locations. It’s human nature to want to achieve lofty goals, but your SMART goals should lay out the path necessary for you to achieve success. By setting SMART goals, you help to refine your ideas and clarify your objectives to keep you on track. When you have clear goals in place, it’s easier to hone your efforts in the right areas of your business and allocate your resources accordingly. SMART goals are also helpful because they bring a layer of transparency to how you run your business.
How to Create Smart Goals for Business
Now that you have an understanding of the framework, it’s time to turn your goals into SMART goals.
Take your current goals and walk through these questions to ensure you’re smart about goal setting.
Initial goal – ____________________
S – Specific – What do you want to accomplish?
M – Measurable – How can you measure progress and know when you accomplish your goals?
A – Achievable – Do you have the skills or resources required to achieve this goal?
R – Relevant – Does this goal align with your overall objectives/vision?
T – Time-based – What is the deadline (and is it realistic)?
Examples of SMART Business Goals
We’ve outlined some examples of SMART business goals to better paint a picture of how you should approach setting these goals.
Example 1: Pay Off $10,000 in Business Debt within 24 Months
One of your SMART goals may be to pay off your company’s debt which will allow you to make more money to allocate to other areas of the business.
- Specific: Pay off $10,000.
- Measurable: How much progress will you make each month? You can determine this by monitoring the cash that’s coming in and out of your accounts.
- Achievable: By spending less on growth-oriented goals, we will work alongside our vendors and encourage them to pay on time and in full.
- Relevant: We’ll call attention to development and project opportunities as the year goes on that will benefit from additional funds after the debt is paid off.
Time-bound: Within 24 months, you’ll achieve this objective.
Example 2: Increase Website Traffic by 25% by December 2023
Your website plays a huge role in your overall conversion rates and helps to solidify your company in the marketplace. By increasing your traffic, your sales will most likely increase as long as your sales conversion rate remains as consistent as possible.
- Specific: Increase the number of website visitors by 25%.
- Measurable: Increase the annual visitor total from 100,000 to 125,000.
- Achievable: The inbound marketing team has refined its social media and content creation strategies. If necessary, we can hire more experts to increase visibility and drive traffic.
- Relevant: By gaining more website traffic, we’ll be able to reach more customers and make more money.
- Time-bound: We want to achieve this goal by December 2023.
Example 3: Increase New Customer Reviews by 25% Year Over Year
Many companies attribute part of their growth to an increase in brand awareness and market share. It’s very important to compile customer reviews to help increase trust and desirability around your company. In the case of this SMART goal example, the company wants to see a 25% increase in customer reviews on a year-over-year basis.
- Specific: Increase new customer reviews by 25%.
- Measurable: Measurable progress through monthly reporting that represents whether or not we’ve hit our target.
- Achievable: Last year, we increased customer reviews by 15% so we believe this year’s 25% target is achievable.
- Relevant: Based on our research, we’ve seen that an uptick in the number of customer reviews corresponds to additional sales in our top growth channels.
- Time-bound: This goal is a year-over-year comparison.
Once you have your goals, see if you can break them down even further. The micro breakdown of your goals is where the magic starts to happen as you realize what will break or what needs to shift in the business to get to that level. Apply this framework to your company and see how much simpler your big audacious goals feel.
Setting goals with trackable metrics will help you move the needle in your business. If you’re not sure where to start, you don’t have to go at it alone. Schedule a free 2-hour counseling session with our Cultivate Advisors to dig into your business to uncover bottlenecks and develop a roadmap based on where you are in your business and where you would like to be. With this roadmap, you’ll have a tangible plan you can implement to reach your long-term goals.