If a company or an individual wants to succeed, they need two things:
- A vision of what they want to accomplish, and
- A plan of action.
This advice may seem rather obvious. Of course, how can you know if you’re heading in the right direction unless you know where you want to go in the first place?
But knowing that you should have clearly defined goals, and actually having them are two different things.
As a business owner, you probably have thousands of other micro-tasks competing for your attention every day. It’s not surprising that goal setting has taken a back seat. It can seem impossible to actually make any time to create a vision for your business, to “waste” time that could be used getting real work done.
While this mindset is admirable on some level (you’re showing that you’re very dedicated to getting your work done), you need to understand that it’s ultimately holding you back.
Hustle is good… but intelligently directed action is better. As cliché as it sounds, you have to work smarter, not just harder.
Effective goal setting is the best way to ensure you’re working smart, not just blindly plugging away at whatever’s in front of you. But where do you find the time to do this?
Easy – you make time for it in your schedule. You simply have to plan your planning.
Planning Your Company’s Planning
It’s not hard to fall into the trap of thinking you don’t have time to spend on more abstract activities, even if they’re extremely valuable – in this case, goal-setting. To avoid this, you need to dedicate time to your schedule for the planning process.
Creating a framework that determines when you’ll focus on crafting your vision, setting up relevant goals and establishing smaller sub-goals will help you to succeed. Having actual time set aside for these tasks in your calendar will ensure that you actually do them, rather than feeling vaguely guilty about not doing it every now and then. The process of scheduling these activities (and performing them!) at regular intervals will help them to become habitual and much easier to stick to.
There are many different approaches you can take to set this up in your business. The one that we personally recommend here at Clockshark is “Plan, Deploy, Review” (PDR).
By putting this system in place, you can ensure that everyone at the company is on the same path when it comes to working towards your big vision, guided by relevant signposts (measures of progress) along the way. You’ll also be able to ensure that adequate attention is given to all three domains: Plan, Deploy, and Review. Plans are worthless if they are never rolled out… and plans that are never reviewed are sure to become outdated and useless over time.
One common way of approaching goal setting is on an annual basis. In our personal lives, we set New Year’s Resolutions every January (and forget about them by February – but that’s beside the point). In business, each year is typically broken up into four quarters, with each quarter consisting of three months. Standard approaches recommend that the first quarter be mostly dedicated to establishing goals, as well as the action plans they require for completion.
Some key points to remember when planning:
- You need to determine what measurements will help you evaluate if you have reached your goals. Simply writing down your goals is a good start, as it focuses on what you want to achieve. Figuring out relevant metrics is even better, as it sets you up to understand the effect of your actions – this will be crucial in the “Review” stage.
- Focus is key. When creating your goals, it’s better to limit the list to a few big items than to pad it out with a lot of smaller things. Smaller measures are more useful as in-between steps, signs that you’re headed in the right direction.
- To reiterate more tired conventional wisdom, you should employ the SMART model of goal setting. We’re going to look at that in more detail in the next section (just in case you’re not familiar with it).
What are the 5 smart goals?
As we can see from the picture above, the SMART acronym stands for Specific, Measurable, Attainable, Relevant and Time-Based. Goals that exhibit these five characteristics are invariably more effective than those that don’t.
Let’s look at these in a little more detail.
Every goal should be specifically targeted towards achieving a particular outcome. For example, instead of saying “I will try something new at work,” say, “I will grow the service side of our business.” This instantly provides you with better direction, guiding your actions more effectively.
Building on our example above, if your goal is to “grow the service side of our business”, then you need to figure out how to quantify success. For example, you might say, “I will grow the top line revenue of our service business by 10%”. Having a predetermined benchmark to judge success or failure will enable you to accurately determine how effective you’ve been. Without this quantitative element, there’s no difference between 1% growth and 100% growth – both are just as “successful”.
Your stated goal should be a stretch, but it shouldn’t be out of the realm of possibility. You don’t want to play it safe, but you also don’t want to set unrealistically high targets. Doing this will condition your employees to expect to fail, ruining your chances of success before you even begin. For example, “Create a new product line that quadruples total annual revenue in 90 days” is probably too far, while “Do slightly better than last year” isn’t far enough.
You owe it to yourself to objectively assess what you’re capable of achieving. Something that’s attainable (yet challenging) will motivate your employees far more than goals that are too simple or too ridiculous to even consider.
While this characteristic may be fourth in the list, it’s probably the first thing you should consider. If the goal is not relevant to the vision of your business, you shouldn’t pursue it. Focusing on constantly pursuing new clients while neglecting existing ones is a terrible strategy for a business dedicated to cultivating good customer relationships, no matter how well-established this goal is.
Your goals need to have a deadline attached. Without having this in place, you won’t know when to review your actions, measure your progress, or set new ones. By starting with your annual goals, you can then determine some relevant subgoals that will serve as a measure of progress along the way. The deadlines you attach to these smaller goals will be assigned in the context of the overall time frame (a year in this case).
Creating these time-frames help us to avoid getting focused on goals that are too big to be actionable. “I will grow the top line revenue of our service business by 10%” is good, and since it’s our annual goal, it has a built-in deadline. However, it’s probably not going to happen overnight. To keep yourself on the right track, you should use subgoals as markers of progress. Any subgoals you create to track your progress towards this bigger objective should have a useful deadline attached e.g. weekly, monthly, or quarterly. These smaller targets are the cornerstones of our action plans, a prerequisite for success in any endeavor.
Simply by utilizing the SMART framework, you will be able to set goals that are useful to you and your business. Once you’ve determined which goals you’re focusing on, you need to schedule them into your calendar – both the overall objective and the steps in between.
Recording these goals in your calendar (with deadlines attached) automatically tells you when to review them – when the deadline passes! When the goal expires, you’ll naturally want to look at how things went. Thanks to your SMART approach, you’ll be able to judge whether or not you were successful, based on your own pre-selected criteria.
In addition to scheduling the end-date, you also need to know when you’re starting work on the goal. This will be the deployment date – having gathered whatever resources you need, you then start working according to your action plan. Wisely selected interim goals will help you to flow easily from one action plan to the next, constantly striving to achieve yet another relevant outcome.
A Quarterly Approach to Goal Setting
As previously mentioned, a quarterly approach to goal setting is a standard business practice. There is a number of different ways to utilize this framework. In the following paragraphs, you’ll find an outline of one useful method. Others exist – if you find one that you prefer, feel free to use it.
It is often useful to use the first quarter of the year to plan out the rest of the year. You determine your goals, break them into more manageable chunks, and choose relevant metrics to judge your success or failure.
Now, you don’t necessarily have to spend the whole quarter planning out the rest of the year. In reality, this would a terrible idea – if you’re giving up 3 months out of the year where you’re not taking focused action towards your business objectives, you’re unlikely to succeed in the manner you desire. Instead, you should view this time as a crucial planning period, where more time is set aside for the task. Plans will invariably change as the year progresses, but the foundation you lay in these initial stages will serve you well in the months that follow.
You will almost certainly find it useful to set aside some time to reflect on the previous year as a whole. By examining the success and failure of the previous period, you will be in a good position to draw on the lessons of the past, avoiding the same mistakes and building on success.
The first quarter is the time to test the assumptions you’ve built your plans on. It’s a simple fact: when you project into the future, you have to make assumptions about different things. The further you look, the more assumptions you have to stack atop one another. This is all well and good while you’re planning, but you may find the whole thing falls to pieces once you try to execute on this plan.
As you start to break down your big stretch goals, take note of the assumptions you’re making. If, for instance, your goal to increase service revenues includes advertising or marketing promotions, test different channels to see which ones perform the best. There’s always a danger that your initial beliefs about which mediums are most effective may be incorrect. To avoid the risk of wasting too much time, energy and other resources, you must be willing to have your opinions proven wrong.
You may find that local radio, social media or even search engine ads are most effective at advertising your particular offering. Rather than relying on your initial impressions, you can commit a small budget to each, testing each channel to acquire hard data – far more reliable than any hunches you may have.
Using the data you’ve gathered from testing initial assumptions, you can then move forward and establish more concrete plans for the year. This can be a continuous process throughout the quarter, or you can confine it to a few weeks in the beginning, adjusting as needed upon regular review. As we’ve already mentioned, you can’t put your entire business on hold while this is taking place. Having continuation protocols in place from the previous year will help to keep things ticking over while you’re figuring out your next moves.
In order to achieve anything, you need to break it down into manageable steps. When you’ve determined these steps, you need to figure out when you’ll work on each one, what’s involved, how long to focus on it, etc. Recording this information in some kind of calendar/time-tracking system is the way to go – it will enable you to see both the bigger picture and the day-to-day necessity of continued progress.
When you’ve got your plans firmly established, it’s time for action. When Quarters Two and Three roll around, you should focus on execution, adjusting the plans as necessary. It is wise to schedule brief reviews at regular intervals (e.g. every month). By evaluating your progress towards your targets, you’ll easily be able to decide whether or not you need to adjust your approach.
As the end of the third quarter approaches, you need to start examining how well you’re progressing towards your goals. Look back over the previous 8-9 months, and honestly assess your situation.
- What worked?
- What didn’t?
- What obstacles did you encounter?
- How did you overcome them?
- How close are we to our objectives?
- Do we need to adjust our strategy?
Performing this evaluation is incredibly valuable, so make sure you give it the time it deserves. As well as this, you may also need to provide for any seasonal/Quarter Four campaigns you’re rolling out.
In Quarter Four, you make the final push. With the groundwork laid in the three previous periods, you do everything you can to stay on target until the end of the year.
In the second half of Quarter Four, you’ll have a pretty good idea of whether or not you’re going to achieve a particular goal. With this knowledge in mind, you can – once again – analyze everything that’s happened. This builds upon the analysis performed at the end of Quarter Three, so it shouldn’t be very time-consuming. By taking stock with these reviews, you’ll be in a better position to create preliminary goals for the new year, as well as putting continuation protocols in place to ease the transition from one period to the next.
Hopefully, you’ll find that you met all your goals. Realistically, you won’t – particularly not if you’re getting the sort of challenging goals that you should be. Whatever the case may be, you need to take stock of the situation, and use this information to move forward, confident in your ability to improve your situation.
The temptation to forget about long-term strategic thinking and simply focus on grinding out short-term results has lured many small businesses to their deaths. You need to have a well-formulated plan of attack, composed of relevant goals and actionable steps towards their achievement. If you don’t, you’re sure to fall prey to the allure of “here and now”, instead of consciously steering your business in the right direction.
The reason why you neglect to create plans for the business is that you haven’t set aside enough time to actually do it. To avoid this, you need to plan your planning – determine specific times in the month, quarter and year to plan, deploy and review.
The Quarterly approach outlined above is simply one method among many. What’s important is the underlying truth…
- Setting goals are necessary.
- Breaking them into manageable chunks is necessary.
- Reviewing your approach at regular intervals is also, funnily enough, necessary.
There are many benefits to putting this system in place – benefits that are well within reach for you… once you get your act together. Less stress, better outcomes, and a healthier bottom line are just around the corner.
Plan your planning. Fail to do this, and your days are numbered.