Once you know where you want your business to be in the short, medium and long term (your objectives, goals and vision) it is important to understand what your current situation is in relation to each of the desired outcomes.
Thinking about your business goals is a big picture question and it can be overwhelming to think through because sometimes they are so vague that it’s difficult to consider them. Consequently, breaking them down into structured manageable chunks by linking actions to outcomes to objectives to goals to vision so you can test if the actions work as expected and also be able to understand what actions need to change to change outcomes or goals.
The first step in the process is, therefore, to break each of your goals into smaller manageable chunks that can be measured and monitored so that you are able to see the progress that you are making towards achieving the main goal. This also allows you to make changes along the way to ensure that your stay on track.
The primary focus of most businesses are financially based – they want to make more money. If this is your only goal, you should re-think your strategy and consider other areas of your business, such as client goals, production goals, personnel goals and many more that relate to your business and your industry.
If you take financial goals as an example, you may initially split them into sales value, profit per sale, cost of sales, cost of products, etc. All of these will have an impact on your bottom line. Once you have these higher level goals, split them by division and then by individual products or services etc.
Once you have your objectives set at the lowest level you can manage, start to look at what your current performance measures are for them. For example, what are your current weekly, monthly, quarterly sales for each product or service? What are the cost of sales for each? What is the profit for each? etc.
If you do not have the relevant information then you need to find a way to obtain it. You should certainly start marking the various elements immediately so that you start to create a base-line.
Some goals will be easier to measure than others. Normally objective measures, such as sales figures are easier to identify and implement than subjective measure, such as staff morale. This should, not however, put you off setting and measuring these goals. Remember if you can’t measure it, you can’t manage it!