When you think of companies that have lofty business goals, Tesla likely comes to mind. On the surface, the aims of Tesla might seem pretty straightforward—the company wants to sell electric vehicles. In that sense, Tesla has already seen success, having sold almost 400,000 vehicles in the first half of 2021. But their business goals go beyond numbers.
As the company states on its website, “Tesla’s mission is to accelerate the world’s transition to sustainable energy . . . Tesla believes the faster the world stops relying on fossil fuels and moves towards a zero-emission future, the better.” Elon Musk has explained his vision and long-term business goals in his Master Plan, stating, “The point of all this was, and remains, accelerating the advent of sustainable energy, so that we can imagine far into the future, and life is still good . . . By definition, we must at some point achieve a sustainable energy economy or we will run out of fossil fuels to burn and civilization will collapse.”
Tesla’s example shows that companies should be ambitious with their business goals. While they may face significant challenges, with a steady vision, they can achieve great results. They just have to maintain the course.
That’s not to say problems won’t crop up. Business leaders need to contend with the possibility of missing goals that are simply too high or lack organization. They also might be too busy to spend time creating goals or suffer from poor communication. In short, setting effective business goals is much easier said than done.
In this article, you’ll learn how to avoid these problems and discover the tips you need to set strong, achievable business goals.
Table of Contents
- What Are Business Goals?
- What Types of Business Goals Are There?
- What Are the Benefits of Setting Business Goals?
- How to Set Strong Business Goals
- 1. Every Goal Needs to Start With WHY
- 2. Craft and Communicate a Clear Vision
- 3. Research How Other Companies Produced Great Results
- 4. Establish Timelines for Goals
- 5. Develop Strategies and Systems for Completing Goals
- 6. Give People Ownership of Broken Down Goals
- Examples of Business Goals in Action
- Manage Your Goals With Time Management
What Are Business Goals?
Business goals represent the specific aims a company wants to reach in a designated time period. Goals in business can be lofty and ambitious, stretching out for years or even decades at a time. Conversely, companies may reach for short-term goals that can contribute toward more long-term company goals. No matter the time period, business goals are meant to improve an organization and help leaders come closer to achieving their overall vision.
What Types of Business Goals Are There?
Goals in business come in many shapes and sizes. They are intended to spur business growth and achievement, but due to their varied nature, different goals can have different effects. The following are some of the most common types of business goals an organization may set.
- Long-term goals: Long-term business goals are self-explanatory in that they deal with a goal meant to be reached well into the future. Some long-term goals can be as far out as years or even decades depending on what the company is trying to achieve.
- Short-term goals: Like their counterpart, short-term business goals are time-based, only they deal with shorter periods of time. A short-term goal may be set a few months into the future, or it could be as short as daily goals a company establishes.
- Quantitative goals: These types of goals can be measured through concrete data or stats. Think of something like sales numbers for a company over a given period of time.
- Qualitative goals: A qualitative goal doesn’t have hard numbers associated with it. Instead, it involves a certain quality the company wants to adopt, such as improving the public image of the organization or improving customer service.
- Performance-based goals: These goals are often short-term goals meant for specific tasks and responsibilities. They have clearly defined measurables that often indicate how well an employee is performing.
- Process-oriented goals: A process-oriented goal refers to improving a particular process or system. It’s not specifically about the outcome but rather making changes to the process to better outcomes are the result. Process-oriented goals may refer to regular project evaluations and employee check-ins.
- Outcome-oriented goals: An outcome-oriented goal is all about the end result. How you get there isn’t as much of a concern as simply reaching the destination. However, both process-oriented and outcome-oriented goals often go hand-in-hand.
- Personal goals: These are goals set by employees to help themselves develop on a personal level, such as gaining leadership skills. The company may benefit from them indirectly, but that isn’t the main point.
What Are the Benefits of Setting Business Goals?
Business goals keep leaders moving in the direction they want to go in, helping them hold true to their ambitious vision and mission statements. They also break up a long-term strategy into easily quantifiable steps. The following are just some of the benefits that company goals can provide to a business.
- Connects the work employees do to overall objectives and long-term planning.
- Keeps employees motivated, even when things don’t always go as planned.
- Creates realistic timelines for milestones to be reached.
- Sets reasonable and measurable expectations that everyone knows.
- Provides a helpful roadmap when making important decisions about individual projects and the company’s overall direction.
- Helps team members stay on the same page even when working on different tasks.
- Gives employees a sense of momentum and satisfaction as they achieve their goals.
- Maintains levels of accountability.
How to Set Strong Business Goals
Goal setting doesn’t have to be a complicated affair, but it does take some knowledge and skill to set the right goals. Keep the following tips in mind when you set goals for your company.
1. Every Goal Needs to Start With WHY
Very few people or companies can clearly articulate WHY they do WHAT they do. By WHY I mean your purpose, cause or belief—WHY does your company exist? WHY do you get out of bed every morning? And WHY should anyone care?
Every decision you make as a company needs to start with “why.” That includes setting goals that you hope to reach. Determining your “why” comes down to knowing who you are, what your core values are, and why you do what you do.
Think of a pharmaceutical company as an example. Their “why” is to help heal people and fully set them free from medical conditions. Their purpose should be to help ease suffering. However, in this example, let’s say the company’s board discovers that people are dying from a new drug they’ve released to the public. Pulling the drug could hurt the bottom line. If the pharma company stays true to their “why,” they will pull the drug at once regardless of how it might hurt them financially.
The question of “why” is of vital importance. Your company must determine why it exists. You can start this process by thinking of what God has called you to do in this life. What gifts and talents do you have to help others? Identify problems you are passionate about solving and consider how you can improve the world. This will form your “why.”
So many companies do not align their goals with their “why.” When you hold to your “why,” your business can become a bright shining light in a sea of darkness. Being an exception will make that light shine all the brighter. As Simon Sinek puts it in Start With Why, you’ll inspire others to action and uplift people around the world.
Why you should start with “why”:
- Helps you identify a clear direction for your company.
- Gives you purpose and meaning.
- Provides a definite vision for what you want to achieve.
- Shows how you intend to improve the world.
- Create opportunities for others to take action as well.
2. Craft and Communicate a Clear Vision
A vision is not just a picture of what could be; it is an appeal to our better selves, a call to become something more.
Rosabeth Moss Kanter
Crafting a vision is all about painting a very clear picture of what the future holds. Think of the way Elon Musk talks about Tesla as a company leading the way toward a future of sustainable clean energy. When someone hears him speak about that future, it’s easy to get excited and want to contribute.
Having a vision is one thing, but you need to communicate it clearly to other people. Whether you’re a small business or a large corporation, sharing that vision to get more people on board is vital for achieving it. That includes helping your employees understand what your vision is. Discuss the vision of your company with them. Most importantly, connect it to the work they’re doing. This will increase enthusiasm and help them see what part they play in the bigger picture.
The key to communicating a vision is through a vision statement. This statement provides a clear and concise description of what the company intends to do now and in the future. An example of this would be the vision statement for Harley Davidson, which reads, “To fulfill dreams through the experiences of motorcycling.”
How to craft a vision statement:
- Know the “why” behind your company.
- Brainstorm what you think the company’s future entails.
- Draft several versions of your vision statement.
- Review and revise your drafts until you settle on one that encapsulates everything you want about the future.
- Begin communicating that vision with others.
For more help, read about how to create a vision.
3. Research How Other Companies Produced Great Results
Research means that you don’t know, but are willing to find out.
Charles F. Kettering
Part of creating effective smart goals is to look at how other companies have generated success for themselves. It’s easy to see that a company like Apple or Southwest Airlines is successful. Now ask yourself why that is. Researching the subject will help you determine how they created that success.
The idea that you can compare yourself to highly successful companies may sound strange, but you need to develop a starting marker on how to measure yourself. Knowing what other companies have done also allows you to see what others might be missing. You can get a good idea of what you can offer that competitors don’t. In a sense, you are taking advantage of opportunities other businesses missed.
After identifying those opportunities, you can then bring on a team of world changers to go and do it. These A-players, when given clear direction through a vision, will then put all their energy and effort into reaching the business goals you set for them. But it all starts with conducting research on what the rest of the world is doing. Otherwise, you’re just aiming in the dark.
4. Establish Timelines for Goals
People with clear, written goals accomplish far more in a shorter period of time than people without them could ever imagine.
Visions are where you can point into the distant future with a vague sense of timing. Yet, a goal is pretty much useless if it doesn’t have a timeline involved.
This is where the time-based goals come into play as they can vary depending on what you want to achieve. The most ambitious goals will likely have a timeline set years ahead, perhaps even as much as a decade or longer. Reaching that goal may feel overwhelming, but additional goals on shorter timelines can help you reach it. Remember, goals are like stepping stones for reaching greater heights.
Break down your goals into more bite-sized pieces. Establish goals a year out, then make quarterly goals. You can go even further than this, such as monthly and weekly goals, though the shorter the time period, the more it will act as a goal for an individual rather than a team or company as a whole. Every goal should feed into the next, providing a sense of momentum as you make progress. When you have those goals, you’ll need a strategy to achieve them.
Things to keep in mind when making goal timelines:
- Set reasonable timeframes for accomplishing goals.
- Make sure everyone involved in those goals knows what the timelines are.
- Reinforce timelines regularly in meetings, reviews, and other communications.
- Listen to concerns from team members.
- Check in regularly to ensure teams are making good progress.
5. Develop Strategies and Systems for Completing Goals
In strategy it is important to see distant things as if they were close and to take a distanced view of close things.
You accomplish business goals by developing the strategies and systems that will get you there. The goal is the destination while the strategies and systems are the roads. Like the goals themselves, these strategies can be broken down into bite-sized pieces to make them more manageable.
Take, for example, a goal of hitting 100,000 impressions on social media. You might begin by setting a goal of hitting 5,000 impressions by the end of the month. The system you put in place can include making sure you are posting daily and publishing videos every week. Holding to that system will help you eventually reach your goal.
At times, you might not be hitting your goals. That’s when you need to look at your systems and strategies to see if the problem lies there. What was the issue for coming up short? Why was your engagement lower than expected? Identifying the problems will help you correct your course and put you on the path to reaching your goal.
What to keep in mind when developing strategies and systems:
- Identify the data and KPIs you’ll need to track progress.
- Regularly review that information to catch if you’re off track sooner rather than later.
- Put the right people in charge of carrying out the strategies.
- Be ready to make corrections right away.
- Innovate the process when the results aren’t what you want or if you think they can be better.
6. Give People Ownership of Broken Down Goals
Developing a Culture of Accountability where people take ownership for achieving key organizational results requires a willingness to make the link between where you are and what you have done with where you want to be and what you are going to do to get there.
When you establish new goals, someone needs to own them. The person who owns the goal takes responsibility for achieving it. While it might be tempting to have whole teams or companies own a goal, it is most effective when only one person has that responsibility.
When only one person owns a goal, they can then spend their whole effort seeing it achieved. They may enlist the help of others to get it done, but they are ultimately the one who is accountable for it.
This individual approach makes more sense when you break down goals into the bite-sized pieces mentioned earlier. In that way, every employee can have a goal that contributes to the greater whole.
For example, let’s say that a company has a goal of $210 million in sales by the end of the year. That goal is the one the CEO owns. Other parts of the company can then take on their own piece. The online marketplace will be responsible for $70 million in sales, which means the VP of marketing will own that goal. Within that department, web page developers can be responsible for $10 million in sales, while further down, content writers could own a goal of $1 million in sales each.
See how it works? Everyone plays their part by owning their individual goals. If everyone does what they need to, the bigger goal will be achieved.
Other ways to give people ownership of goals:
- Involve workers in setting their goals.
- Communicate how they can help contribute to the overall mission.
- Delegate important responsibilities to people in the organization.
- Share feedback with them regularly.
- Hold employees accountable at all stages.
- Provide recognition both privately and publicly when they reach their goals.
Examples of Business Goals in Action
As a company, you may want to launch a new website with an online store for customers to make purchases. To do this, you would set the goal of launching it in one year. You would bring on teams of web developers, designers, writers, people with experience managing online marketplaces, and more. Each department and individual would have their separate goals to reach after every week, month, and quarter.
You set a goal for the company to sell 1 million units of your product. Setting a timeline for six months or a year might be too quick depending on the size of your business. So, you decide on an 18-month goal. In the process, you bring on experienced salespeople who have shown success in the past. You also create a new reporting system that salespeople fill out that tracks progress and alerts you to any problems before they’re allowed to fester. This means letting some salespeople go who don’t own their goals.
Your company decides it wants to train and develop the next generation of leadership in the organization. The goal is for new leaders to be part of key leadership teams in 10 years. To accomplish this far-reaching goal, you start by creating new training programs designed to teach valuable leadership skills to employees. You place an emphasis on hiring only those who are interested in becoming leaders at some point in their careers. You also develop materials outlining why leadership is important and how they will lead the company into the future. As the years go on, you’ll constantly evaluate how the programs are doing and make any necessary changes.
Manage Your Goals With Time Management
As self-improvement expert Paul J. Meyer once said, “Productivity is never an accident. It is always the result of a commitment to excellence, intelligent planning, and focused effort.” One of the top ways leaders and high performers reach their goals and maintain production levels is through time management. Without it, goals get pushed to the wayside. They’re replaced by extensions, missed deadlines, and busywork that doesn’t fulfill the company’s vision or mission. On top of this, focus, engagement, and job satisfaction all start to decline. However, practitioners of great time management increase their output and do work that moves the needle. As a result, they’re able to more easily accomplish their goals and achieve the better future they’re working toward.
Learn more about what time management skills you need to excel.
Source: Cosmo Politian