How to set the right targets for your business this year
As we begin a new year, there’s much focus and discussion in business meetings on targets. Have we achieved the business targets we set last year? If not, are they still relevant and what do we need to do to get there? What targets should we set for this year?
It’s tempting for businesses which have not achieved all their goals for last year to just roll those unfinished objectives to this year without much thought. But that would be a missed opportunity.
So, how do you set the right targets for your business? It starts with you setting the overall direction, determining where you want your company to go and documenting it in an easy-to-understand one-page strategy summary. Once created, this document should be reviewed by your team (or by you if you don’t have a team) throughout the year to be sure you’re on track to achieve milestones and succeed.
Set the overall direction of where you want your company to go
"Think little goals and expect little achievements. Think big goals and win big success." – David Joseph Schwartz
The first step in setting the right targets for your business is to establish or review your company’s purpose (mission) and ambition (vision) statements (external link). Even if your purpose and ambition statements are developed, it’s always a good idea to review them at least annually to see if they are still relevant to how your company has matured and where you want it to go.
If not, it’s time to update them. And, if you never developed them, this is the perfect first step to setting the right targets. Be sure these statements are inspiring and precise. Everyone in your organisation needs to have a clear understanding of where they are heading if there is any chance of getting there.
Next, with those statements in mind, it’s time to create a simple one-pager that captures your company’s top-level plan, objectives and priorities.
This will help your odds of becoming one of the 10% of companies to turn their strategy into results, because it will be easy for anyone in the business to read and understand what the priorities are, focus on what’s important, and monitor and manage how the team is progressing toward those objectives.
A crucial part of any company’s plans needs to include external changes that impact your business in the next year. Businesses are impacted by legislation such as the EU General Data Protection Regulation (GDPR) and new regulatory requirements may shift your strategy. There’s no doubt that Brexit, and similar decisions, will affect businesses operating with or in the UK.
Your SMART Strategy Board (external link) one-pager should include:
Your purpose: Include statements on your purpose (mission) — why your business exists — and ambition (vision) — what the organisation wants to achieve in the future
Customers: This includes the target market and customer segments you would like to reach as well as your value proposition, or what you are planning to offer those customers in terms of products and services
Finances: This helps your team understand how you will drive revenue growth and profit including how you will finance your strategy
Operations: If you are going to be able to deliver your strategy, you need to get clear on what partners and suppliers you need as well as the internal processes you have to establish, focus on or alter to get you there
Enablers: What enablers and resources will need to be in place to underpin the successful delivery of your strategy? This includes everything from having enough people with the right skills, the right infrastructure and IT systems, as well as the right company culture
Competition and risks: While this is often overlooked on strategy documents, it’s important to be aware of external factors that might threaten your success, such as the biggest business risks as well as competitors to watch out for
Set the right targets for your business with these tips
Since setting goals is something every business should do. It’s helpful to keep the following tips in mind to create objectives that are ambitious, yet realistic and will help lead to success.
· Keep it simple (and have fun)
· Make sure your targets are SMART (external link) (specific, measurable, attainable, relevant and time-based)
· Establish an action plan on how you will achieve your milestones
· Review your goals regularly and change them if they no longer serve your business
· Have short-term (6-12 months) and long-term (3-5 years) goals
· Monitor your progress
· Celebrate and reward success
For more insight on how to create the best goals for small businesses, check out The Ultimate Guide to Small Business Goal Setting (external link).
It doesn’t matter what product or service you sell, whether your company is a start-up or has been around for decades, or it’s just you running the show or you have hundreds of employees. Setting the right targets for your business is the way to stay focused, keep your organisation advancing forward and set your company up for success.
At Hiscox, we want to help your small business thrive. Our blog has many articles you may find relevant and useful as your business grows. But these articles aren’t professional advice. So, to find out more on a subject we cover here, please seek professional assistance.