Goal-Setting Key to Business Success

Options are many, including OKR, SMART, PEERS and FAST

When starting a business, the excitement of a new product or service makes goal-setting seem easy.

But one to two years in, how do business owners keep the momentum going and continue to set targets to move their business along an upward trajectory? If they lack a clear roadmap or core goal, they may find themselves without a defined purpose or something specific to strive for, resulting in stagnation and a struggle toward meaningful accomplishments.

“They need to actually clarify what their purpose is and then setting goals should be a fairly easy thing to do,” said Franklin Taggart, consultant with the Loveland Business Development Center and owner of Franklin Taggart Coaching. “The goals are the first level of that business actually doing what it’s here to do.”

Goal-setting helps clarify vision, avoids wasting time and resources, keeps things on task and serves as a source of motivation to carry out that vision, Taggart said.

“The goal helps to motivate you to action, and if the goal doesn’t really motivate you, it’s not a goal. It’s something else,” Taggart said.

Goals, essentially resolutions to achieve a desired result, need to be present in business plans and a regular part of ongoing business operations. They can be financial, such as driving more revenue or cutting costs; growth to increase market reach, launch new products or raise brand awareness; or customer-focused to improve the customer experience.

Processes for Setting Goals

Setting goals can follow many processes but at the core should achieve specific, actionable items with a clear timeframe. Simple statements such as “I will make more money this quarter” or “I will expand my customer base” are too broad in scope and do not provide much direction.

Instead, the idea is to write down an actual number of projects, clients or monetary value to aim toward and the steps to get there.

BHAG and SMART

A good starting point is BHAG, or the Big, Hairy, Audacious Goals, those inspirational statements of vision that represent big dreams and take time, maybe even years, to achieve.

Develop a list of BHAGs and brainstorm tactics to reach each one. Revisit them every so often, such as on a quarterly basis, to measure accomplishments so far and what adjustments need to be made.

Realize BHAGs and the smaller goals to get there can be written out in any number of ways, but that already established frameworks are proven to work. One such framework is SMART, suitable for personnel and organizational goals since it offers quantifiable and time-bound measures of what businesses want to achieve.

“SMART is probably the most widely known in the business world. It’s helpful to have a framework to set your goals, especially for somebody who’s new in business,” Taggart said. “It makes your goals easier to communicate to other people in a meaningful, powerful way. Everybody has to have buy-in in order for those goals to be met … and understand what they need to do much more easily.”

SMART is:

Specific, or how to identify what’s desired to accomplish:

  • Why are the goals important?
  • Who’s involved?
  • Where will the goals be carried out?

Measurable, or how to assess and measure progress, such as in money savings and growth rates:

  • What data can be used to determine if goals have been met?
  • How will it be known that the goals are accomplished?

Actionable/Achievable, or what is obtainable with the time, money and resources available:

  • How are goals achieved?
  • What actions need to be taken to carry out the goals?
  • Are the resources needed to achieve the goals available? If not, how can they be obtained?

Realistic/Relevant, or what aligns with the direction of the business:

  • Do the goals match the business’s other efforts?
  • Do the goals make sense for the business to do?
  • Is it the right time for the goals to be addressed?

Time Bound, or what’s the target date or deadline:

  • When do the goals need to be completed by?
  • What can be accomplished within the timeframe?
  • What can be done immediately, such as in the next month?
  • What will require a longer timeframe?

OKR and PEERS

Another approach to goal-setting is OKR, or Objectives and Key Results. Typically, OKRs are written with an objective at the top and three to five supporting key results below, such as, “I will (Objective) as measured by (Key Results).”

The objective is what is to be achieved and is significant, concrete, action-oriented and inspirational. Key results are specific, time bound and realistic yet aggressive. They serve as a benchmark and are a way to monitor how to reach the objective. At the end of an identified time period, they are reviewed to see if they’ve been filled or need more work.

PEERS is a form of goal-setting that involves an element of coaching. Peers refers to Powerful, Easy, Emotionally Compelling, Reachable and Student- or Employee- Focused.

“That would be great to have in an environment where people are in entry-level jobs,” Franklin said. “Having something that is that plain and simple would be really helpful as far as goal-setting is concerned.”

PEERS is:

Powerful:

  • Will the goals make a difference for the company’s mission, vision and objectives?

Easy:

  • Are the goals easy to implement?
  • Are the goals seen as worthy, valuable and achievable?

Emotionally Compelling:

  • Can employees be compelled to action by being moved emotionally?
  • Can they envision what’s possible?
  • Do they have the desire to do it?

Reachable:

  • Are the goals doable?
  • Do employees feel like they have agency, or the ability, to reach the goals?
  • Is there a plan or strategy to carry out the goals?

Student- or Employee-focused:

  • Do the changes the goals bring about make a difference for the employees?

FAST

Goals can be set to drive what’s called strategy execution, where ambitious targets are identified with specific metrics and milestones to measure progress toward those targets.

Strategy execution is possible when the goals are transparent and allow for interdependence among employees. The goals need to leave room for corrections to keep the company competitive and adaptable to an ever-changing environment and changes in the marketplace.

That’s where the FAST method comes in with goals being Frequently Discussed, Ambitious, Specific and Transparent. FAST goals are reviewed on a quarterly or regular basis to allow for continual adjustment, since they need to be timely to keep operations continual.

FAST is:

Frequently Discussed:

  • Are goals discussed often enough to enable corrections due to changing circumstances?
  • Are feedback systems in place to encourage employees to make suggestions?

Ambitious:

  • Are goals ambitious enough to encourage employees to try harder?
  • Can the goals improve the performance of individuals and teams?

Specific:

  • Are goals stated clearly and concisely so that employees know what they need to deliver?
  • Can the goals be measured to evaluate their effectiveness?
  • Can the goals identify what’s not working and how to go about correcting it?

Transparent:

  • Are goals made publically available to employees, so that they realize what they need to do?

Accountability and Success

Once a framework is in place and goals are set, being accountable to carrying out those goals is just as important for success.

One approach is to find an accountability partner to check in on a regular basis to manage each other’s progress. According to the American Society of Training and Development, individuals who commit to someone have a 65% greater chance of completing their goals.

Other things to do include tracking progress in a CRM or personal accountability journal and being willing to change if a process isn’t working. Realize that fallbacks may occur, remaining committed to completing tasks for the current or updated goal. It’s the steadfastness that will generate results.

But accountability doesn’t work for everybody and can keep some businesses from being transparent, Taggart said.

“Rather than accountability they ought to think about integrity,” Taggart said. “The thing that is really important in organizations is that they have transparency as far as their goals are concerned.”

Employees who are transparent are honest about the results they’re getting and any obstacles and problems they may encounter, Taggart said.

“Transparency is just that you’re being open about your process the whole way through. You’re not hiding anything from anybody,” Taggart said. “It means you’re being open with each other about what’s happening as things are happening.”

The LBDC can help business owners and entrepreneurs figure out which roadmap to follow for goal-setting, as well as ways to be accountable and transparent. This work is done through one-on-one meetings with a consultant, a service provided through the Small Business Administration.

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