Want your business to succeed? The first step is to decide what your business goals are and work from there. Here’s why goals are so important.
Business leaders of all stripes like to talk about goals and strategies. But there’s more to success than simply throwing a few buzzwords around. It helps to know what they mean and how they play off of each other to lead to the final result.
The Real Definition of “Goal”
Goals are typically understood to mean a desired end result, but they’re actually more than that. A true goal is one with a deadline. Here are two examples of positive-minded goals one might encounter in a business plan:
- Establish Company X as the leader in robotic Valentine gifts.
- Establish Company X as the leader in sales revenue in the robotic Valentine gifts industry by 2020.
You should notice that these two attempts at writing a goal are similar but not identical. In the first case, the writer failed to give the goal a deadline. This is a crucial feature of a goal. If you don’t set a deadline, then all you have is a wish. Give it a deadline and your wish turns into a goal.
The second goal has another thing going for it that the first one doesn’t have. It’s a bit more specific. Instead of ambiguously striving to be the “leader”, this company wants to be the leader in sales revenue. So when you write out your company goals, make sure you give them a deadline and make them specific enough that you can measure them.
What Constitutes a Business Strategy?
A business strategy is the path you take to achieve your goal.
So you want to spend the next five years making yourself the best-selling robotic Valentine gifts company. But how will you do that, exactly? However you decide to pursue that goal, that’s your strategy.
Perhaps you’ve decided the best way to sell your robotic Valentine gifts is to demonstrate their ability to woo a love interest. So your strategy might say something along the lines of “persuade consumers that Company X’s line of robotic Valentine gifts is romantic, easily programmable, and fully autonomous”.
That’s an awesome strategy, but that alone won’t get you from Point A to Point B. You need some objectives.
What’s Your Objective?
Objectives are mini-goals. They are smaller, vital steps to reaching your ultimate goal along the path of your stated business strategy. In other words, to determine what your business objectives are, you must commit your company to your strategy. A full commitment will focus on objectives.
Looking at the above-stated strategy, what kind of objectives could Company X use to follow the stated path? Here are three potential objectives:
- Obtain 40% of the robotic romantic gifts market by 2021
- Partner with a world-class microchip processor to improve the programmability of Company X robots no later than end-of-year 2020
- Increase customer retention by 60% by the end of this year
See how each of those objectives have deadlines and are specific and measurable? This is so you can benchmark your way to success as you measure each objective on your path to strategic success. But each objective must be pursued through successful implementation of tactics.
In Stanley Kubrick’s Space Odyssey 2001, HAL 9000, the artificial intelligence computer aboard the Discovery 1 spaceship, goes haywire and wreaks havoc on the spaceship’s crew when he malfunctions. Perhaps Hal would not have acted so erratically if he had defined his objectives a bit more clearly.
Let Your Tactics Push You Toward Your Goal
The key to successfully achieving your goal is to follow the strategic path you’ve outlined by striving for well-defined objectives that you work toward through tactical operations. In other words, you reach your objectives by focusing on implementing your tactics. So define what those are based on what makes sense for each objective.
For instance, to increase customer retention by 60% by the end of this year you can increase your inbound call center response rate by implementing a new call routing system. Perhaps you might also decide to embark on a new social media initiative where you utilize Twitter as a customer service tool designed to shorten your customer response rate. There are two tactics that are relatively easy to achieve and are defined well enough that you can measure their success post-implementation.
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Ultimately, your company’s success depends on how well you execute your tactics, but if those tactics aren’t written with your objectives in mind, then you’ll go off course. Your objectives, of course, are defined by your strategy, which is determined by your goal. If you backward plan your success, you are more likely to achieve it. Look at your end goal first and then decide how you’ll get there.