Financial Blog

Small Business

Although we often rethink our goals at the beginning of the new year, it is extremely important to keep track of our progress multiple times throughout the year. It isn’t enough to set a goal, then let it sit there and collect dust like an old little league trophy. 

 

Setting your small business goals for the year allows you to refine your strategies and track your progress so your business doesn’t stagnate. Goals help you stay focused on what you aim to achieve, and help guide your business further down the pathway to success. 

 

To help you get started with setting your small business goals for the year, here is a mechanism to help you set your goals in ways to help improve your business for the better. Make sure that your goals are in fact SMART(specific, measurable, achievable, relevant, time-bound) and create a plan to win in the new year.  

How to create SMART Goals For Your Business

A SMART goal is a short acronym used to guide us to achieving the goals we want to win. Each letter in a SMART goal focuses on the key components that you want to have in your goals so that you can put a plan together to succeed. Small business owners rely on this tool to focus on critical goal-setting details essential for success. 

 

Here is how each letter in a SMART goal helps you target your focus to get the results you want.

S=Specific 

Think of setting a specific goal as ordering a pizza. If you aren’t specific with your order, you might end up with a pizza pie topped with pineapple and anchovies when you really just wanted plain cheese. Either way, you won’t really get what you want unless you are specific. 

 

“I want to reduce business expenses,” is a broad goal, but saying that “I want to reduce my business expenses by $10k” makes it a specific goal. It targets an area you wish to tackle and allows you to refine a strategy on how to get your goal accomplished. 

M=Measurable 

After you set a specific goal, how are you going to quantify your efforts? Not measuring your efforts is the equivalent of those dreaded company meetings that could have been better in an email and follow-up response. 

 

If your goal is to create a new customer service process, measuring how efficient your business monitors customer satisfaction is crucial, just as an example. Measurable goals require that you know where you are at now, in order to know what is possible and what to do in order to get there. 

 

Perhaps your business debt stems from spending too much money in online advertising, but not enough in training employees to become experts in your products or services. Tracking and measuring your practices allows you to gain clarity and evolve. 

A=Achievable 

Are your small business goals for the new year achievable? Or, do they merely represent wishful thinking? Most small business owners dream of their face on the next cover of FORBES as the next brightest and brilliant business success story; but, in order to achieve success, goals need to be realistic. 

 

If your wish is to gain new clients and increase profitability, it doesn’t help you or your team to simply “wish” for new clients to show up in herds. 

 

How many new clients should your company aim for in the new year? How many clients do you need to gain per week/month in order to reach your yearly goal? What’s the most number of new clients that you’ve taken on in any given period of time? What is a realistic increase from that number? Make sure your calculations are within your reach and you are on the right track to making it happen.

R=Risky 

Setting achievable goals are important, but you also want to make sure that your goals stretch you a bit. What that means is, if you’ve sold 100 widgets every quarter, setting a goal of 100 widgets a quarter doesn’t help. Perhaps 110 or even 120 would be a stretch (but attainable) if you did a few activities to drive sales that maybe your sales team has been lagging on. 

 

Even if you don’t hit your goal, you’ll probably learn something from the process. Usually you learn what works versus what doesn’t. Or maybe something will work with a few tweaks. Setting risky, but attainable goals will help you tweak your processes and push the envelope so that your business grows on purpose.

T=Timely 

Most realistically, if you set your small business goals for the year, the desired outcome is for those goals to sprout and grow within the year. However, we all know Father Time moves at his own pace, so it is essential to create a timeline for yourself and those that are needed to contribute in order to make the goal happen. 

 

Creating milestone markers and evaluating the status of your specific goals during sets of time - quarterly, bi-weekly, weekly, etc. will ensure you are managing your time and company money wisely. 

Be SMART in the new year 

Increasing your company’s profitability is a broad goal, but if you set a specific plan that is measurable, possible to achieve, relevant and risky to the uniqueness of your company, and can be accomplished in an amount of time that makes sense - you have set a SMART goal for your small business in the new year.