How to Set Goals to Build a New Business

Setting goals for both new and ongoing businesses is fundamental to success. Simply put, if you don't know what you're aiming at, how are you going to figure out how to get there? Too often, a company fails not only to set short and long-term goals. Here are some basic steps to follow.

Instructions

1. Write a Mission Statement. This defines the reasons why your business exists. It should be concise and clear. For example, Tenexa is a hiring and retention firm. Their Mission Statement: “Talent has no limits. We optimize human potential, increase happiness, and maximize the engagement of people by providing superior solutions for understanding, acquiring, developing and retaining talent.”

2. Conduct a market and competitive analysis. You need to understand your target market’s dynamics, which includes demographics and the characteristics of your target audience--how, when and where do they buy the product or service you offer. You also need to understand your competitors, gathering information on the 4P’s of marketing – pricing, product, promotion and placement (distribution). You need to know what you’re up against so you can develop well defined goals.

3. Assess where your company is now. Detail out exactly where your company stands on current profits and revenues. You need to know where you are to decide how to get where you’re going. Conduct a SWOT Analysis--Strength, Weaknesses, Opportunities and Threats. This enables you to honestly evaluate your firm’s strengths and weaknesses, and based on the market data you’ve gathered, evaluate opportunities and threats.

4. Set your long-term Strategic Goals. Where do you want the company to be in five years? These include such key objectives as product line up, growth objectives, sales and revenue goals, profit targets and human resource plans, as well as broader brush goals; for example, “We want to be the number one provider of Internet service in the state.”

5. Map out your goals in writing, in greatest detail for year one, that is, monthly and then in quarterly and finally annually in the later years. Meet regularly to review how you’re doing vs. goals. Share it not only with the management team, but with all your employees, and assign tasks at all levels so everybody is working towards these goals.

Tips & Warnings

• Be flexible. The market changes constantly, with new competition coming in, prices shifting, global economics impacting things. Your goals should be reviewed at least once a year, preferably every six months, so you can update your game plan as new information becomes available. Don’t be afraid to change--it’s key to survival.

Resources

• U.S. Small Business Administration