“All my life I’ve had one dream, to achieve my many goals…”

“If you visualize yourself fitting into these jeans, then you can achieve just that. Hang them on the back of your bedroom door from now on and look at them longingly before you go to sleep every night.”

I couldn’t believe what I was seeing and hearing, but I decided to keep watching for a while longer.

“You see, the more you visualize your goal, the more you bring it to life. By thinking about it, you are drawing your goal towards you. By simply seeing yourself wearing these jeans, you are bringing your fate to reality.”

There should be a law against this type of programme, I thought, as I watched the nonsense unfold in front of my eyes.

“Within a few months, you will be going out with your friends wearing these jeans and you’ll be the envy of all of them…oh, and you need to stop eating so much too and exercise more.”

I should probably explain what this is all about.

Recently, I was flicking through the channels and I came across some ridiculous programme where a ‘life coach’ was giving this ‘advice’ to a seriously overweight girl and convincing her that pretty much all she had to do was visualize her goal and it would materialize without any real effort on her behalf; other than an almost aside about ‘stopping eating so much too and exercising more’. Genuinely, I think such programmes should be banned entirely, and of course the girl didn’t achieve the goal. I don’t want to be mean here, but there was no way in hell that she could have achieved it in the timeframe allowed, and especially so given where she was starting from, plus the fact that as the programme unfolded the only thing she was prepared to do was the visualizing bit: she didn’t stick to the diet, nor the exercise regime. I think there is really something very wrong in terms of building up false hopes in people simply for the sake of making a television programme.

Anyway, I’ll climb down off the soap box now as that’s not the point of today’s post. However, the programme did get me focused on the importance (and limitations) of goal setting. I have written before on setting personal goals, but today I would like to focus on goal setting for your business.

First of all, as I have said numerous times before, business goals are good, essential even, but only when those goals add real value to the organization in the sense  that they adhere to the age-old SMART principles: Specific, measurable, achievable, realistic and time-bound. What I mean by this is that setting unrealistic goals within your business can do more harm than good. All managers need to be careful when setting business goals in terms of how they are devised and structured because badly designed goals can be worse than having no goals at all; they can lead everyone in a direction that is counterproductive, or they can achieve short term aims but damage longer term potential. For example, I have seen many times in different types of businesses how goals were established in terms of revenue targets, which although achieved, were not of utmost value because the costs generated in making those revenue targets meant that the increased revenue did not proportionally translate to the bottom line. I have also seen ambitious sales targets being achieved, but in doing so customers were left feeling somewhat swindled which damaged customer satisfaction and longer term sales.

So with the SMART tag attached, I think that goal-orientation and effective management undoubtedly go hand in hand. First and foremost, the best managers are good at setting effective business goals, which stretch everyone for sure, but are also within their capability to realize.  As touched upon above, it is important too that goals are not only focused on the short-term, because this obsession with the here-and-now has, in my humble opinion, contributed greatly to the economic mess we now find ourselves in. And it’s not just me who is railing against the folly of short-termism and far more authoritive voices than my own are making the case for a shift away from too much short-termism. For example, the Aspen Institute, a respected international think-tank with a mission to foster leadership based on enduring values and whose members include people such as Warren Buffett, James D. Wolfensohn and Bill George to name a few have backed the following call: “We believe a healthy society requires healthy and responsible companies that effectively pursue long-term goals. Yet in recent years, boards, managers, shareholders with varying agendas, and regulators, all, to one degree or another, have allowed short-term considerations to overwhelm the desirable long-term growth and sustainable profit objectives of the corporation.”

Setting meaningful business goals

So how can you balance short and longer term concerns when goal setting? Well, every business activity needs an overall framework to guide it and the task of goal setting should happen within a broader strategic context. In other words, you lay the foundation for effective goal setting within your business when you develop vision and mission statements. I have written past articles on that specific activity, but what you want to end up with are meaningful statements which will guide all business activities, including goal setting. As a reminder, these statements are intended to:

Vision
Your vision statement is concerned with the longer term future. In brief terms, it answers questions about your business like:

  • What are we trying to achieve?
  • What do we want the business to become?
  • What is the collective ambition driving us as a management team and group of employees?

Mission
If your vision relates to the desired destination, then your mission statement is all about the journey itself. Again, in broad terms, it describes what your goals are for how your business will operate in relation to your key stakeholders: owners, customers, employees, the wider community, etc. It sets out to briefly capture the answers to questions like:

  • What will we deliver for our owners/investors?
  • What are our customers’ expectations and in turn what will we deliver for them? What will it be about our customer experience that will be unique, that they won’t get anywhere else?
  • What do our employees mean to us? What will it be about working for us that stands out from all the places our employees could work?
  • What commitments are we making to the wider community?

Where meaningful statements are developed, they make a real difference in my experience and in terms of goal setting, they enable you to define broad strategic goals for your business. These goals should again be stakeholder focused, so you could have a range of goals relating to:

  • Owners/Investors – Finance, including return on investment, profitability, earnings per share, etc.
  • Customer – Goals should be defined around customers to include satisfaction and loyalty.
  • Employee – Goals should be defined in areas such as engagement levels, employee turnover and productivity, etc.
  • Operational – Specific goals should be developed for all key processes, sales and marketing, HR, operations, environmental management, Corporate Social Responsibility etc.

It is these strategic goals which should create the context for all subsequent goal setting and they are helpful because, by their strategic nature, they overcome the limitations of only thinking about the short term. You might end up with a goals framework which has strategic and more immediate targets:

Increase Business Profitability by 10% within three years

Possible sub-goals

  • Grow domestic sales by 5% per annum
  • Launch new product range by end of 2013
  • Increase online sales from X to Y by end 2014
  • Reduce labour cost from X% to Y%
  • Reduce general overheads % from X to Y

Build Brand Awareness within five years

Possible sub-goals

  • Increase repeat customers by 25% in the period
  • Increase number of social media followers from X to Y across main platforms in year 1 and revise target for subsequent years
  • Increase number of monthly business website hits from X to Y within twelve months
  • Increase proportion of returning visitors to website per month from X to Y
  • Raise Net Promoter Customer Feedback Score to 95% within two years

Build Employee Engagement Levels by 40% within five years

Possible sub-goals

  • Reduce employee turnover levels from X to Y
  • Generate 100 number of implement new ideas from employees per annum.

These are of course just sample goals, plucked from thin air, but the important point is to develop a strong relationship between your strategic goals and any other tactical or short-term goals in the business. In other words, when you are aiming for any particular short-term goal, it should be 100% clear to you just how this is contributing to a longer term objective.

Of course, a bit of visualization is never any harm when it comes to goal achievement, but in terms of realizing business goals, the next step is obviously to do something to achieve them, and this begins with strategy formulation. There is a lot of nonsense talked about strategy, but you must develop a strategy, or in reality a number of interlinking strategies, that will realise the strategic goals you set. With general strategies agreed, the next important consideration is to ensure that you have, or can source, the necessary resources to bring strategy to life. Without appropriate resources, you don’t have a viable strategy, but rather a wish list. And with resources defined, you then need to agree specific activities each year to translate those strategies into action. This requires some form of annual or tactical planning process that specifies which actions will be implemented in any given year so that you are executing your strategy.

It is through this integrated goal-setting and achievement model that you can really drive business performance. Additional points to consider when setting any goals for your business:

  • Include your people in defining the goals in the first place, where possible.
  • Get everyone to publically commit to attaining the goals. Breaking promises is not something most people like to do.
  • Offer continuous encouragement and motivate your employees to keep going.
  • Allow your people to self-monitor progress. Ownership is everything.
  • Provide regular feedback on progress.
  • Recognize and remove blockages which may be holding things back.

Once business goals are set, effective managers excel at building and sustaining buy in for them, so much so, that I have often been quite surprised at just how much employees come to see the goals as being their own, with the result that those who work for these managers tend to feel part of something bigger than themselves and view the achievement of organizational goals and satisfying their own needs and aspirations as being compatible, not contradictory.

I headlined today’s post with a quote from the great Homer (Simpson, that is) and I think his muddled words tell us an important thing about goals…there’s no substitute for hard work in terms of achieveing them.

Enjoy your day!

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