A new year is the time small business owners should pause and reflect on the direction of their business.
As a business owner, you spend the majority of your time on the day-to-day operations and neglect to block out time to review what you’ve achieved during the year and how to take your business forward to become more profitable. This is the time when having a business plan with clear and concise goals is so important.
Your business plan is your go-to document for goal setting, and will be backed with the strategies and actions that need to happen to achieve those goals.
To take action to achieve your goals, you’ll need a business plan. Setting goals is the best way to achieving bottom-line results. Research shows that when entrepreneurs set measurable goals for themselves, they’re more likely to achieve them.
True goal setting means defining your objectives in practical, measurable terms. Resources, time and funds also need to be identified and invested toward goal attainment.
Once you know where you want to go, the next step is to figure out how you’ll get there. By creating smaller manageable goals, you’ll gain a greater sense of accomplishment and find that your business can reach larger goals more efficiently and quickly.
There is a common framework to setting goals that is used by all types of management, from major corporations to small business owners—the SMART method.
SMART goals are defined as being Specific, Measurable, Achievable, Realistic and Timely. When it comes to goal setting, the SMART system is simple and gets the job done. Each goal must be defined so that it meets the following criteria:
Specific, achievable and realistic— Make sure your goals are concrete, concise and attainable. Instead of “I want to make more money this year,” specify “I want to increase my revenues by X percent (a realistic amount) by the end of the year.”
Measurable— Frame your goals in such a way so you can measure your progress. For example, measure monthly or quarterly revenues against the previous year’s figures.
Timely— Focus on attainable goals that can be realistically reached within the year. Break it down into monthly or quarterly increments, which will allow you to build on the momentum of goal achievement.
It’s best to keep track of where the business stands in relation to your goals. Stay organized and be consistent. Write your goals down and keep them handy.
How often do you check on their progress? Weekly? Monthly? How do you know if you’re headed in the right direction? This is the “measurable” part of the SMART method.
Schedule the dates now for throughout the year to review the goals set forth in your business plan. This will help you stay on track.
Should you need assistance with developing your business plan and setting goals, contact the Napa Valley College Napa-Sonoma Small Business Development Center at (707) 256-7250 or visit napasonomasbdc.org.