Goal Setting for Small Business

Now that you have developed your mission and vision statements, it is time to do some goal setting for small business.

Your mission statement defines your business, what you do, how you do it and who you do it for. Your vision statement defines the future.

Basically your goals and objectives are the methods you choose to maintain your business and to achieve the future state you have described in the vision statement.

Characteristics of Goals and Objectives

Goals or objectives (these terms tend to be interchangeable in this context) should be measurable, quantifiable and meaningful.

If an objective is too broad i.e. "to increase sales", it is very difficult to determine whether not not you have actually achieved your goal. Does an increase of $100 mean that you have achieved your goal, or are you really talking about thousands of dollars?

By clearly defining the goal statement in terms of a concrete number, an increase in sales of $10,000 or 10%, it is much easier to measure and evaluate your success.

To make the goal statement meaningful, you must link the goal back to your vision. The outcome of each goal should move your business closer to your vision of the future.

Strategies and Action Plans

Strategies and actions plans are the actions you will take to achieve your goals and objectives. These strategies are not to be confused with the overall competitive strategy that you have or will develop for your business. The overall strategy set the scene for your business. It determines whether you will be a low cost supplier, or a high end provider within your market. Strategy at this level determines how you will position your business within the market and guides your competitive behavior.

All of your goals and objectives, lower level strategies and actions plans should be aligned with your overall competitive strategy.

Types of Objectives

Goals and objectives can be developed for all areas of your business including:

• Corporate Business Objectives,
• Marketing Objectives
• Production Objectives
• Financial Objectives
• Human Resource Objectives

The corporate objectives determine the performance targets for the whole business, for example to increase sales or turnover, or to increase profitability. The marketing, production, financial and human resource objectives each contribute to achieving the corporate objectives, and each of these lower level objectives are supported by specific strategies or action plans.

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