The Importance of Realistic Business Goals

Not sure how to plan for the future of your business? ?It seems that many times a business owner will make decisions based on intuition and gut feeling, but that can become pretty unpredictable, leaving you feeling stressed and below target. Business goals are staring you down, your employees are pushing burnout, and the feeling that it’s all going to come crashing down can be overwhelming. How can you plan for the future and set goals if you don’t know what to expect?

It can be tough to plan and set business goals in today’s world when it is so unpredictable for a lot of small businesses. There are a lot of factors that should influence business goals and expectations. If you’re looking for a pattern to compare how revenue might come in, the past couple of years are probably not going to give you true results. First, you need to put goals and expectations down on paper. This can help you feel like there’s a little more control over the resulting outcome. It’s important to understand that a plan does not guarantee success, however, you can plan for contingencies and continue to expect the best, and stay optimistic.

Setting the right company expectations and goals is the key. It’s a plan for revenue, expenses, and profit down to what kind of personnel the business has, and how to manage your team through these stressful times.

As you begin to think about your plan for the future, it’s important to map out what your business currently looks like. After these past couple of years, it is going to be easy to make a mistake and go in the wrong direction. Data-driven planning is critical for business owners, especially since most business owners tend to act on gut feelings or what seems to be trending at that moment. By adding the stability of data-driven planning and setting realistic goals, business owners can help keep everyone moving forward and feeling productive.

Setting realistic expectations is about using data-driven metrics and planning tools to get to the heart of your unique business needs.?Start reviewing your historical data, and look specifically at revenue, COGS, Gross Profit, overhead, and Net income over the past few years.?Even if you’ve done well historically you were probably shown during the height of the pandemic that those figures can go out the door fast.?(You wouldn’t be alone in experiencing this, as many other small and large businesses experienced a shockwave that could never have been predicted.) This includes thinking about the people that you have, the procedures that you have in place, and how you’re going to effectively communicate what work needs to be done and the expectations of how it will be done. To get the numbers you want, you’ll need to make sure everybody is communicating openly and effectively. Work with them to create more effective and cost-efficient operational procedures, determine what types of clients have higher margins, how to emphasize your resources on those, and find different kinds of marketing to help get through the year with a smaller marketing budget. What you will have as a result will likely be higher profits than you had historically, although you may have brought on fewer clients the ones you have now are the ones you want to keep. Your team will be happier and report a much more positive culture within the organization!?

Have your employees participate in the business and be transparent with them about how the company is doing, and what business goals you have for this year. Employees are feeling the uncertainty in today’s world, they may wonder if they’ll still have a job in a few months, or even if your company will still exist. As you get everyone more involved in the business and ask employees to take on new tasks, make sure that they understand any changes in their job description and that they participate in the change in their roles and what the responsibilities will be. Ensuring that your company culture provides plenty of positive reinforcement will help employees understand how well they’re doing on the new job expectations.

Make sure that your team has the right amount of support, training, and enough time to learn how to do these new tasks, with an ongoing training plan to build better skills at those jobs. You may find that some of your employees have talents that you didn’t even know about. These talents might have not been in their job scope previously but could prove beneficial as the company adjusts and adapts to a new way of operating.

Rethink your plan to establish realistic goals for your business as you move forward. You don’t have to keep doing exactly what your business does now, or how you’ve always done it before.

What that could mean for you as a small business owner is finally getting the results you thought you could when you started this. So, don’t give up and remember CoEfficient can help push you in the right direction!