You’ve probably heard the saying, ‘If you don’t know where you’re going, any road will get you there.’ It’s a great saying, but it doesn’t apply in the world of startups. When you launch your business, don’t be so eager to dive in that you forget the most crucial step: setting clear goals to grow your business.
A startup without goals wastes both time and resources. But the good news is, with the right goals in place, you can steer your startup straight toward success.
What Are Business Goals?
Business goals provide clarity and direction for your startup. They answer questions like, “What should I do first?” and “How can I ensure success?” By setting specific, measurable, achievable, relevant, and time-bound (SMART) goals, you can navigate the startup process effectively.
There are several types of business goals, each serving a unique purpose:
- Short-term goals: These are immediate objectives that need to be accomplished within a short timeframe. Examples include securing funding, launching a minimum viable product (MVP), and building a core team.
- Long-term goals: These are ambitious objectives that are typically achieved over a longer period. They might involve expanding into new markets, achieving profitability, or becoming a market leader.
- Financial goals: These are focused on the financial performance of your business. They could include increasing sales revenue, reducing costs, or achieving a specific profit margin.
- Operational goals: These relate to the day-to-day operations of your business. Examples include improving efficiency, enhancing customer satisfaction, or implementing new technologies.
- Marketing goals: These are aimed at promoting your business and increasing brand awareness. They might involve growing your customer base, increasing market share, or improving your brand reputation.
Setting business goals is an ongoing process. As your startup evolves, you may need to adjust your goals to align with changing market conditions, customer needs, and business objectives. By consistently reviewing and refining your goals, you can ensure that your business is on track to achieve long-term success.
Importance of Setting Startup Business Goals
If you are tempted to skip the effort of setting startup business goals, let’s examine why these goals can make all the difference between success and failure. Startup business goals are concrete: you will set measurable goals, determine exactly how to reach them, review them, and proceed to reach them.
In addition to ensuring your startup is moving in the right direction, there are several other reasons goals are crucial in startups:
Goals Create Expectations
When sketching goals for a year, a startup business owner can specify each goal by month, by subject matter, by level of importance, or by some other measure. No matter which metric you choose, setting goals creates an expectation that those goals can be met if you are committed to reaching them.
When you set goals, you are starting a series of conversations with yourself: this is what I believe I can achieve in this startup within three months, six months, or in one year. You can easily review and adjust your goals as needed. And since you are the one who has set the expectations, you will be more motivated to reach those goals.
Goals Create Patterns
Each time you meet a goal you’ve set for your startup business, you create a pattern of reaching goals. And reaching one goal will propel you onward to meet the next goal.
According to the Harvard Business Review, setting business goals “motivates us, gives us a sense of purpose, and helps us feel accomplished.” Such results set us up to create patterns of goal-setting on a continual basis.
Goals Create Order
Startup founders have an entrepreneurial spirit, in the sense that you aren’t afraid to take a measured risk on a new venture. But because we are individuals, we have varying levels of risk-aversion. Goals create a sense of order, which many business owners crave.
Order suggests that everything is under control. Inventory that is orderly is soothing for many, just as financials that are in order are comforting for others. Business goals create a mental framework of order and encourage repeated goal-making.
Goals Create Motivation
Goals for startups are time-sensitive and most of them will need attention within the first twelve months. As each business goal is reached, you will begin to anticipate and expect that the next can and will also be reached.
As monetary goals are set and reached, you will be further motivated to create new, higher goals for the future of your startup. At this point, short-term and long-term goals can be established, which leads to further motivation to drive growth and meet goals.
Goals Create Challenges
Setting long-term goals can and should be challenging. There is no reason you cannot look ahead and expect to fully meet the challenges embedded in your business goals. It goes without saying that meeting monetary goals is satisfying, but you will find that every business goal you set and achieve is just as satisfying.
Meeting challenging startup business goals creates a strategic win for your first year of business. This in turn will lead to greater incentives and faster momentum for the next year. As each year passes, the business will continue to meet obstacles, face challenges and reach goals toward greater profitability.
Goals Lead to Business Acumen
Business goals don’t actually create business acumen, but they do lead to business acumen. As a startup business owner, you are testing and trying out every aspect of your business. You may be trying a new sales strategy, testing a theory about your target audience, or trying a method of delivery that is unknown.
Setting goals and accomplishing them leads to an increased understanding and deeper business acumen. As each goal is met, you gain another indicator that you are making good decisions. And, even when a business goal is not met, the experiential outcomes lead to greater business acumen.
How to Create Effective Startup Business Goals
There’s much more to setting goals than reading about them and working to achieve them. The practical question is, “What strategy or structure can I use to effectively create the goals I need?” Unless you’re already familiar with goal-setting, the actual practice of doing so can be difficult to begin.
Here are some key considerations for effective startup business goals:
- Choose a goal-setting process that aligns with your organizational style
- Create reasonable goals rather than a “wish list.” Unreasonable expectations can lead to discouragement.
- Review your goals regularly; determine what steps remain to be done to reach a goal. To assist in this practice, post your goals and the business objectives within them where you’ll see them every day.
- If a business goal cannot be reached for any reason, take time to consider the reasons behind the result. Use your assessment to refine new business goals.
Let’s look at the steps you should take to kickstart your strategic planning and business goal-setting:
1. Build Working Business Objectives
Using the key element of working objectives you’ll establish the goal and then attach the objectives needed to fulfill the goal. A working objective is the practical and functional parts of each goal. Each goal may have two to three working objectives embedded in it.
Example: Business Goal = Add 1,000 new retail customers before the end of the fiscal year.
Working business objectives:
- Present a new product line to one major industry buyer
- Contract with an independent representative group to extend regional sales performance
- Implement targeted marketing campaigns to reach potential customers in untapped geographic areas
- Partner with complementary businesses to cross-promote products and reach a wider audience
- Conduct market research to identify emerging trends and customer preferences.
2. Set Achievable Business Goals
Create measurable, timely and achievable (MTA) goals.
Example: Business Goal = Purchase one tow truck and open a new territory within twelve months.
(Measurable, Timely, Achievable)
- Verify costs (including insurance, repairs, etc.); purchase truck within six months
- Market tow service to insurance companies in the south and east sectors of the city
- Collaborate with regional auto repair shops to open new markets within eight months
- Measure the effectiveness of the business objectives and outcomes at the end of twelve months
- Develop a customer satisfaction survey to measure the quality of service and identify areas for improvement
- Create a social media presence to promote the tow service and build brand awareness
- Track key performance indicators (KPIs) such as number of tows completed, customer satisfaction ratings, and revenue generated
3. Create Simple and Specific Goals
If details become distracting, keep your goals in check. Make them simple and specific. In doing so, you will be more inclined to reach those goals.
Example: Business Goal = Obtain customer relationship management (CRM) software and set it up.
- Research and shortlist 3 CRM options that align with our budget and features.
- Request demos from shortlisted providers to compare usability and functionality.
- Create a timeline for software implementation, including training sessions for the team.
- Develop a system for data migration from existing customer databases.
Startup Business Goals Examples
One of the key considerations when creating your business goals is to align each with who you are. Don’t bother to set lofty, unreachable goals, even if they sound amazing. Define business goals that make sense to you. Consider the following examples of well-crafted startup business goals to help shape your own goals.
Example #1
Business Goal: Increase online sales by 20% within the next quarter through the launch of a visually appealing and user-friendly e-commerce website.
A well-designed and user-friendly website is essential for a business to reach its target audience, build credibility, and drive sales. By having a website in place, businesses can showcase their products or services, provide valuable information, and facilitate online transactions.
Business Objectives:
- Create a visually appealing and responsive website that is optimized for desktop and mobile devices.
- Develop clear and compelling website navigation that guides visitors to relevant information.
- Integrate high-quality product images to enhance the shopping experience.
- Implement a secure and efficient online payment system to facilitate transactions.
- Optimize the website for search engines (SEO) to improve visibility in search results and increase website traffic.
Example #2
Business Goal: Improve customer satisfaction and loyalty by implementing a personalized customer experience program within three months.
Satisfied and loyal customers are invaluable assets to any business. By providing a personalized experience, businesses can build stronger relationships with their customers, increase customer retention, and drive positive word-of-mouth referrals.
Business Objectives:
- Gather customer data to understand their preferences, needs, and purchase history.
- Develop personalized marketing campaigns based on customer segments and preferences.
- Implement a customer loyalty program with rewards and incentives.
- Provide exceptional customer service through multiple channels (e.g., email, phone, chat).
- Encourage customer feedback through surveys and reviews to identify areas for improvement.
Example #3
Business Goal: Enhance employee satisfaction and retention through a positive work environment and effective communication.
Happy and engaged employees are more productive, loyal, and likely to stay with a company. Investing in employee satisfaction can lead to increased morale, reduced turnover, and improved overall business performance.
Business Objectives:
- Create a supportive and inclusive company culture that values diversity and fosters a sense of belonging.
- Implement clear communication channels to ensure open and transparent communication between employees and management.
- Provide opportunities for professional development and growth to help employees reach their career goals.
- Offer competitive compensation and benefits to recognize and reward employees’ contributions.
- Encourage work-life balance by promoting flexible work arrangements and providing support for employees’ personal needs.
Example #4
Business Goal: Increase sales team productivity by 20% within the next quarter.
A more productive sales team can directly contribute to increased revenue and business growth. By improving efficiency and effectiveness, sales representatives can close more deals, generate higher average order values, and shorten sales cycles.
Business Objectives:
- Implement a CRM system to streamline sales processes and improve data management.
- Provide targeted sales training to enhance product knowledge, sales techniques, and objection handling.
- Set clear and achievable sales goals for each team member, aligned with overall business objectives.
- Offer ongoing coaching and mentorship to support sales representatives in their professional development.
- Analyze sales data to identify areas for improvement and optimize sales strategies.
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