With the new year come a new set of challenges. For many, the new year is a time of resolution, a time when they take a long hard look at themselves in the mirror and vow to make a change. One could argue that any time is a good time to make a change but our thoughts always tend to turn to New Year’s resolutions even though we’re psychologically predisposed not to keep them.
For most of our friends and family members this may be a case of shedding a few of the unsightly pounds that have racked up over the festive period, putting more effort in at work to get that raise or promotion they’ve been gunning for or even taking their career in a whole new direction. For entrepreneurs, however, this phenomenon takes on a whole new level of meaning and importance.
Whether this will be your first year in business or whether you’ve been at this for some time, it’s important to begin the year by looking at what’s behind as well as what’s ahead. It’s a time to reflect on what you’ve learned and what you’ve accomplished as well as areas in which you may have fallen short. It’s a time to take stock of your skills and look at areas in which you’d like to develop both as an individual and for your business. It’s a time when you take a step back to look at the big picture… It’s a time for goal setting.
Why is goal setting so important?
There are a great many arguments in favor of setting goals for just about everyone, but especially for entrepreneurs. Entrepreneurs are amongst the most hard working and resourceful people on the planet but they also tend to struggle with their macro perspective. So many entrepreneurs are at their happiest and most effective when they roll their sleeves up and dive into the day to day operations of their business, whether that’s collaborating with their team of employees, mixing it up with customers or spending hours and hours on creative projects. This is all great and should be commended but as an entrepreneur it is also incumbent upon them to take a step backwards and approach their business strategically, looking at it from a bird’s eye view instead of retreating to the familiarity of the ground level (a place from which it’s fairly difficult to see the woods for the trees).
Goal setting is a big part of this process as it helps to drive your enterprise in a very particular direction. It colors everything from your digital marketing strategy to how you coach your employees to how you deal with your customers. Your goals will be defined by, and indeed help to define the core values of your brand.
So, now that we’ve established that goal setting is a smart idea from a personal and business perspective, it’s probably also a good idea to make sure that we do it right.
Make your goals SMART!
In many ways the setting of goals for a Small to Medium Sized Enterprise (or SME) is similar to setting goals for those elusive New Year’s resolutions, and people invariably end up making the same kinds of mistakes. They set goals which are too vague and nebulous, unrealistic or for which progress is difficult or even impossible to track. To guard against this, it helps to ensure that your goals are SMART. This means that they are;
- Specific- Vowing that you will “be the best” in your field is all well and good, but it’s hardly a specific goal and therefore one in which progress will be limited.
- Measurable- How will you be able to track your progress? How will you be able to quantify whether you’re close to achieving or failing?
- Achievable- Ambitious goals are great but if you set a goal which you feel may not be achievable this can only harm your morale and that of your employees.
- Relevant- Does your goal fit with your business model? A goal that requires a top-down reorganization of your business is likely not worth having.
- Time-Based- If you don’t ascribe a deadline to a goal, you may never find yourself accomplishing it, and it’s forever put on the “laterbase”.
It’s not all about the money
Of course, all businesses exist to make money, but that should not negate the importance of other, non-monetary goals. Even in your monetary goals it’s important to introduce specificity. While making enough to afford that duplex you’ve had your eye on for a while or to pay for your kids’ college tuition are noble goals, they’re not specific within the context of your business plan. It’s far better to aim to increase profit or turnover by a realistic percentage point by the end of the fiscal or calendar year.
With all that said, chasing monetary goals may not always be the best thing for morale or for your business and monetary goals are best kept alongside their non-monetary counterparts. Worthy goals of this variety include increasing your production yield by a certain percentage, increasing productivity, taking steps to improve employee satisfaction, making new clients or improving your customer reach. As you have no doubt already asserted, the setting of non monetary goals will often have a positive knock on effect on your profit margins.
Where will you spend more and where will you make more?
As well as making money, you should also look for this as an opportunity to treat your business to some spending. After all, it takes money to make money and investing in your business’ infrastructure is a great way to ensure that you achieve your goals. This could be the year in which you make the investments that will increase your productivity, your output and your revenue.
Will this be the year in which you make a new capital investment in a new piece of equipment that will allow you to make more of your product at a faster rate? Will it be the year you give your digital marketing campaign the surge it needs to ensure that your brand reaches those hard to reach places that traditional marketing has a tendency to miss? Will this be the year in which you recruit a dynamic new member of the team who has the knowledge and experience to bring ideas to the table that you’d never have thought of? Will you move your business to a better located premises with more footfall?
Whatever your goals, pertinent spending will help you to achieve them so its important to ensure that your business has sufficient cash flow to do this.
Where will you innovate?
What’s the difference between a small business person and an entrepreneur? The difference is innovation. A great idea may be enough to launch a small business but entrepreneurs have big ideas and achieve them by evolving through innovation. It’s this process that turns garage engineering outfits into global software giants and travelling milkshake maker salesmen into heads of the most recognisable brands in the world.
Where will you innovate in your business practices this year?
Don’t forget those personal goals too!
It helps your business goals immensely if you can supplement them with some personal goals. Identify some elements of your entrepreneurship that you’d like to improve. Perhaps you’d like to manage your stress so that you’re more approachable to your employees. Maybe you’d like to become better at managing your time. Or maybe you’d just like to address your work life balance so that you get to spend some more time with your family.
Whatever your goals, make them specific, measurable, achievable, relevant and time-based and both you and your business will be unstoppable.