Oftentimes, developing basic overall goals for your business just isn’t enough. Instead, you need very precise, tangible objectives to help accomplish your goals. But what are SMART goals?
They help you determine exactly what you want to accomplish, how you will do it, and when you will do it. Approaching goals in this way is the difference between a casual walk through the park and a well-planned hike on the trail. While both are valuable, the second serves a specific purpose and leaves you with an accomplished end goal.
What’s the difference between saying “We want to grow this year”and “We want to generate 20% more leads this year than last year”? Specificity.
Specific goals clearly state what you want to accomplish. There is no doubt as to what you are going to do and how you will know you have succeeded.
To create specific goals, ask yourself these questions:
- What exactly do I want to accomplish?
- Why do I want to accomplish this?
- What are the requirements for succeeding?
- What constraints exist to accomplishing this goal?
It’s amazing how the act of asking and answering these questions immediately sets you up for a greater chance of success. Knowing exactly what you want to accomplish, why you want to accomplish it, and what you will need to do to overcome it puts you in a position to line up the right people and resources with a specific purpose. That’s a formula for progress.
If you’re running a business, the overall goals are probably to generate revenue and grow over time. While these goals are important, understanding how to measure the outcome of the goals is even more important.
The same is true for the goals you make for your business. You need to be able to measure where you were before you started the goal, how well you’re progressing toward the goal, and when you have met the goal.
While each part of SMART is important, measuring carries significant weight because it allows you to see progress towards your goal.
When a goal is too large, too broad, and too expansive, it becomes daunting almost immediately. Big dreams are a good thing. But, they’re even better when they’re broken down into smaller goals that are easily attainable. For example, just saying out loud, “We want to make $1 million next year” can sound very overwhelming. Immediately, our minds begin to think, “How will we increase our revenue that much? Do we even have the manpower to do that? Is this even possible?”
But, imagine taking that goal of $1 million and breaking it up into smaller, more attainable goals. You know your business is on track to generate at least $700,000 based on last year’s numbers. Now you can generate quarterly goals to put you on track to your end destination of $1 million.
- by the end of Quarter One, you need to increase revenue by $100,000-$125,000.
- by the end of Quarter Two, you need to generate an additional $200,000 to cover expenses and stay on track for your revenue goals.
- by the end of Quarter Three, you need to generate at least $100,00-$125,000 to keep you on track and adjust for any additional expenses required for growth.
- by the end of the year, you need to make any additional hires and generate $150,000-200,000 to reach your goal.
While those numbers are still large, they’re nowhere near as overwhelming as the thought of generating one million dollars all at once.
Goals that are not relevant to your business or do not fit the resources you have are a waste of your time and energy. Here are some questions you can ask yourself to determine if this goal is truly right for you, right now:
- Is this goal worthwhile for our business?
- Will accomplishing it put us in a better market position?
- Is this the right time for us to accomplish this goal?
- Do I have the necessary resources to accomplish this goal? (Resources could be team members, inventory, space, money, time, etc)
- Does accomplishing this goal keep me in line with the long-term objectives I have for my business?
In the same way that choosing smaller, more attainable goals allows you to accomplish a larger goal, timeliness of those goals will also keep you on track toward your desired end.
Having a set date holds you accountable to completing your goal. It’s a helpful practice to create a specific goal you want to accomplish by the end of the year and then break that goal into either quarters or into 12-month steps. Taking a big goal one step at a time makes it much more manageable.
Make SMART Goals for Your Business
To help you along in developing SMART goals for your business, we’ve created a worksheet that walks you through it.