Every business is driven with goals to keep the operations stable, thriving, and growing. Successful companies from the small to large-scale levels garnered its achievements out of the motivation to complete its business goals.
A business goal is defined as clear, focused target of a profit-earning company with a purpose of solving business solutions and problems. Primarily, a business goal must be measurable and quantitative. It must describe the particular change or adjustment, the manner of making the change, a unit of measure or other variables to monitor the change, and a specific time frame or target date for such change.
Advantages of Having Criteria and Process
Business goal setting encourages the people to contribute significant effort since every employee knows the individual expectations that must be met in order to help achieve success in the business. Effective goal setting is based on a set of essential elements or factors and step-by-step process that every person involved in the business must apply and be conscious of for a smooth attainment of the business targets.
In business, managers go through a critical process of business strategic planning, which concludes to identifying the right goals to be set for the entire business activity. Part of setting the right goals is identifying the needed criteria and processes.
Essential Factors in Business Goal Setting
- Business goals must be focused on the result but not on the activity. The employees and management must always aim for the achievement of the goals. Failed goals create an impact on the contributed efforts of the people, which would reflect a poorly structured goal setting.
- Business goals should be relevant and realistic. Goals that do not directly apply to the real situation or condition of the business are pointless and futile, even if they were successfully attained. For example, if the goal is to increase the revenue by 20% in the next quarter, make sure that the current market and economic status is not down or going through recession. If it is, the goal will not be relevant enough to the business activity and may even be hardly achievable.
- Business goals have to be measurable. Goals in business must be quantitative since numbers and figures play a critical role in almost all of its activities. With measurable goals, entrepreneurs can keep track and objectively monitor the growth of a business. A goal such as “to gain bigger profits for the fiscal year” is a little too vague and qualitative. For it to be quantifiable, it is better stated as “to gain 50% profit earnings for the fiscal year”.
How to Set Business Goals
Business goals are best formulated with the approval and consensus of business partners or the people in the management. A full cooperation of the members involved in the goal setting is needed for a business to achieve its objectives.
Here is a step-by-step process of setting business goals:
- To start with, a meeting with the management leaders, top employees, and those who ought to be part of the goal setting must be conducted. With goal setting as the main agenda, this must be highlighted at the onset of the forum.
- Brainstorm ideas and solicit opinions from every participant and note them all down. Talk about how each goal can be potentially achieved.
- From the list of generated goals, the group must categorize them into primary and secondary objectives. The list may also be refined into the goals that are necessary based on the SMART goal setting technique.
- After the carefully selected goals are outlined, the participants must discuss and list the requirements that each goal needs. These may range from the people involved, resources, finances, and so on.
- It is also important to list down the possible obstacles and barriers that the business may encounter. Limitations and guidelines are helpful as well in the accomplishment of the goals.
- Develop an action plan for each goal and possible business solutions to potential problems.
- Assignment of tasks and roles will be needed to create a harmonious process.
- Tracking and monitoring are very essential especially that most business goals are quantitative.
- For successfully achieved goals, appropriate reward and recognition must be given to the employees and the management.