“Management by objective works – if you know the objectives. Ninety percent of the time you don’t.” – Peter Drucker
Now that you have your mission, vision and values for the company, it is time to set your company goals. A goal is a measurable outcome over a specific period of time that is realistic and in alignment with the organization’s mission, vision and values. Goals are set and then strategic initiatives are identified which will be required to accomplish the goal. Employees can ensure that their day-to-day activities are in support of the company goals.
In addition, employees are motivated by goals and goal achievement, and they wish to know that their work matters and will make a difference. This is the case when goals are set and communicated, and their activities are in alignment with the company goals.
Business goals should be:
- Time bound – goals should be set with a timeframe for achievement in mind. They can be set for one or more time periods (i.e. 12 months, 2-3 years or 5 years +), and linked together. Goals expressed for time periods under 12 months, are generally considered to be business objectives or targets and will be part of a business plan
- Formulated to achieve the company’s vision and mission
- Easily understood, clear and concise, but can also be broad in scope
- Realistic and achievable, given the company’s resources
- Measurable, so they can be tracked and judged whether they have been achieved
- Meaningful in that achievement of the goals will make a considerable difference to the company. It is best therefore those goals are outcomes focused versus input driven.
Goal characteristics above are from Small Business NSW.
The following organizational areas require goals to be set in order to accomplish the overall company mission.
- Financial Goals. The most important goals for the company outline the financial targets over the business strategy time period. All other goals in other areas must support these goals.
- Customer Goals. The required customer goals which will result in the necessary sales to accomplish the financial goals.
- Products & Services Goals. The goals for delivery and support of the product/services which will result in the necessary sales to accomplish the financial goals.
- Partner Goals. Goals for the strategic partnerships which will deliver the required product/services or customer results.
- Employee Goals. Goals for the required employee training, development, productivity increases and retention needed to support delivery of the organizational goals.
- Internal Goals. Goals for internal systems efficiency improvements which will enable the organization to deliver on the outlined customer and product/service goals.
- Community Goals. Goals that focus on giving back to the community, volunteering, philanthropy, engaging local businesses, and/or protecting our planet and natural resources.
Financial, Customer, Products/Services and Partner goals outline for the business “what you do”. Employee, Internal and Community goals outline “how you do it”. Depending on your business, you could have other major areas of the business that require more emphasis, so you would include them at this level, or you may wish to de-emphasize one of these areas (e.g. Partners) at is not at this high level of strategic importance required to accomplish your company’s mission.
Usually 2-4 goals in each area are sufficient to outline what the organization needs to accomplish. Remember that business units and departments will break this down further with goals in their particular areas that support the strategy goals.