Business goals help your business achieve its desired results. To do this, you need to determine measurable, realistic, and specific objectives.
Defining goals is the first step to achieving the results you’re looking for. So in this article, we’ll show you what you need to know to be successful at it.
What are business goals?
Business goals are the steps to achieving the results a company wants. These objectives should be measurable so you can assess their progress and make any necessary changes in your strategy.
These goals can be established for each department separately or for the entire business. Goals can be set for employees and even clients, as well.
What’s the advantage of having a goal?
Having defined goals is important for finding your way to the desired results. Some of the advantages of defining them are:
- It orients decision-making towards the results you want.
- It steers coworkers to work toward the same outcome.
- It provides a basis for measuring success.
- It guides implemented strategies.
What kinds of goals are there?
In terms of function
When you classify goals by their function, we have:
- General goals: These express the results desired by the end of the project in clear, concise, and realistic terms. An example would be creating more opportunities for the sales team.
- Specific goals: These are the stages given definitions in order to achieve the general goal. It is essential you take expected results for each stage into account and establish indicators and procedures for measuring them. One example related to the goal of generating more contacts is the strategy of creating and running an enterprise blog with conversion-centered content.
In terms of deadline
According to the time required to complete them, you can classify goals as:
- Short-term goals: These take between a day and a year to be completed. An example would be to increase blog traffic by 50% in the next six months.
- Medium-term goals: These take between one and five years, for example, achieving 10% of market participation in two years.
- Long-term goals: These take more than five years, such as making a product sell in at least 40 countries in 10 years’ time.
Examples of business goals
Goals will always depend on the results a business wants as well as its needs. However, to give you an idea, we’ll show you some examples that can give you a bit of insight:
- Maintain or increase business profitability
- Obtain greater productivity
- Provide excellent service to customers
- Attract and retain human capital
- Reach the right customers
- Keep the fundamental values of the company
- Have sustainable growth
- Refine how changes are managed
- Stand out against competitors
- Keep a healthy cash flow
Why should you measure a goal?
When you measure a goal, you can know your business’s exact situation relative to a goal.
Metrics help you make sure you’re on the right path to achieving the outcome you desire in the established time frame. This way, if things aren’t going well, you can make adjustments to get you back on track to your goal.
How do you measure a goal?
To measure a goal, you need to find the right metrics. Such metrics are known as Key Performance Indicators (KPIs) and can help show you the progress of your business goals.
Finding the right KPIs is essential for understanding how your business is doing. This is why you should choose those that have a real impact on your goal.
Shall we see an example? If your objective is to increase sales in a certain period, an interesting KPI would be to calculate sales revenue and compare it with values from previous periods to know if your efforts are worth it.
In this case, you should add all the revenue from customers in a pre-established period of time and subtract any refund costs. Once you have it, do the same for the preceding period of time. Therefore, you’ll be able to make comparisons and find whether your strategies are working.
How do you define a project’s goals?
Choose quantifiable goals
When you define tangible and measurable goals, you can more easily evaluate their progress and success.
The goal of increasing sales, for instance, is very broad, so you need to consider questions like the term length to achieve it and how much it should increase. In this manner, to define a similar goal, you would ideally establish a date and a clear objective. For example: by the end of the year, increase sales by 15%.
Choose specific goals
If you have a general goal, you should determine specific and exact goals that will put you on the right path. In other words, you should plan the concrete steps you’ll need to follow to complete the project.
With the goal of a 15% increase in sales, which steps do we need to follow to achieve it? Generating more potential clients through marketing channels and getting to 1,000 daily visits on your blog by the end of the year are a few examples.
Define realistic goals
To be successful, you must be realistic. Taking into account the resources you have to achieve your goal is fundamental. If you set a goal without the resources to realize it, you’ll only end up frustrated.
There’s no point, for instance, in “get to 1,000 daily visits to the blog in a month” if today there are only ten. Unless you have an extremely aggressive strategy, this would be very unlikely.
Set a deadline
Establishing project start and end dates is vital to prevent delays in acting. This is the only way to avoid indefinitely postponing your goal.
If your objective is to increase the number of qualified leads by 25%, you should establish the length of time it will take, starting from the date you are contemplating it until the date you manage to reach it. A model example would be “increase qualified lead generation 25% within the next ten months.”
4 methods to define your business goals
To more practically help you establish your business goals, we will show you some existing methods in the following section.
This method was developed to create effective business goals in any business area. It’s based on five criteria, whose initials make up its name:
- Specific: A goal should be specific so everyone involved has a clear understanding of what needs to be accomplished.
- Measurable: Goals should be measurable. If you make one you can’t measure, there’s no way to know if it was achieved or not.
- Achievable: We need to know if set goals can be achieved or not. Why create a goal if you can’t achieve it (within a set deadline)?
- Realistic: When you create a goal, you also define those responsible for accomplishing it. The more relevant the goal is, the more motivated those involved will be. If a goal has no impact on the business, it won’t be seen as a priority.
- Time-bound: Every goal should have a due date. If you don’t set a due date, you can achieve your goal in a day, a year, a decade, or never.
An example of a SMART goal might be “to increase the number of visitors to the website by 40% in the next six months.”
The CLEAR method aims to define objectives effectively and has another five principles as its basis:
- Challenging: The goal needs to be challenging and add high value to the business. If it isn’t challenging, it’s a mere task.
- Legal: Each goal should be in a legal agreement with the place it’s connected to.
- Environmentally sound: Sustainability is a current theme in businesses that should also be considered when making goals.
- Appropriate: There should be consistency between goals in order to avoid contradictory scenarios.
- Recorded: Goals should always be related to market changes so that they may be constantly refined.
For its eco-friendly bent, we can take as an example “the creation of a new paraben- and sulfate-free hair product line over the next eight months.”
PURE goals relate directly to business ethics. They should have the following criteria:
- Positive: It should describe what you want to obtain, and not what you want to avoid.
- Understood: The goal should be understandable for everyone involved.
- Relevant: A goal has to be relevant for the business. If it isn’t important, it won’t be prioritized.
- Ethical: The goal should respect sustainability and the environment.
An example of a PURE goal might be perfecting process automation in a five-week period.
Even though the GROW method is mostly used in a personal domain, it can also be applied to professional life. It has the following criteria:
- Goal: What are the goals and points to be reached in the future?
- Reality: What are current conditions, what internal and external obstacles exist?
- Options: What are your strengths? What resources do you have available and what are your possibilities?
- Will: Which actions must be taken, and who is responsible for them?
As an example, a manager can set a goal of starting team meetings on time, with everyone promising to stop any activity ten minutes before each meeting.