What are Business Goals? Definition, How To Set Business Goals and ExamplesApril 3, 2020
Business goals are an essential part of establishing priorities and setting your company up for success over a set period of time. Taking the time to set goals for your business and create individual objectives to help you reach each goal can greatly increase your ability to achieve those goals. Here, we explore the definition of business goals, the difference between business goals and objectives and provide tips as well as examples of short- and long-term business goals.
What are business goals?
Business goals are goals that a business anticipates accomplishing in a set period of time. You can set business goals for your company in general as well as for particular departments, employees, managers and/or customers. Goals typically represent a company's larger purpose and work to establish an end-goal for employees to work towards. Business goals do not have to be specific or have clearly defined actions. Instead, business goals are broad outcomes that the company wishes to achieve.
Setting business goals are important for several reasons, including that they:
- Provide a way to measure success
- Keep all employees on the same page as to what the goals of the company are
- Give employees a clear understanding of how decision-making reaches company's goals
- Ensure the company is headed in the right direction
Related: SMART Goals: Definition and Examples
What are business objectives?
Business objectives are clearly defined and measurable steps that are taken in order to meet a company's broader goals. Objectives are specific in nature and can be easily defined and kept track of. Companies must establish objectives in order to achieve their business goals.
Related: 10 Business Strategy Examples
Business goals vs business objectives
The following are the differences between business goals and business objectives:
- Business goals define the "what" of a business's purpose whereas business objectives define the "how."
- Business goals typically only provide a general direction that a company will follow whereas business objectives clearly outline actionable steps.
- Business objectives are measurable whereas business goals generally are not.
- Business objectives are specific whereas business goals are more broad and all-encompassing.
- Business objectives typically have a set timeline whereas business goals do not.
How to set short-term business goals
Short-term business goals are typically goals that you want your company to achieve in a period of weeks or months. The following are steps you can take when setting short-term business goals:
- Identify your company's short-term business goals for a set period of time.
- Break down each goal into actionable business objectives.
- Ensure your objectives are measurable.
- Assign goal-related tasks to employees.
- Measure progress regularly.
1. Identify your company's short-term business goals for a set period of time
The first step in setting short-term business goals is to figure out which goals you want to achieve in a set period of time. Many short-term goals are goals that further the achievement of long-term goals. Consider your long-term goals as well as what you want to accomplish in the next weeks or months and translate these into short-term goals that will propel your business forward.
2. Break down each goal into actionable business objectives
Next, you should break down each short-term goal into actionable objectives. These objectives should represent the steps your company will take to reach each goal. For example, if your goal is to get six new customers in the next month, your objectives will be the steps you will take to secure the business of six customers, such as putting a new ad in a newspaper and posting three times a week on social media.
3. Ensure your objectives are measurable
The business objectives you establish in the previous step need to be measurable. For example, if one of your objectives to reach a short-term goal is to post more on social media, don't simply state "post more on social media" as a strategy. Instead, make the objective measurable by being as specific as possible. Using the above example, you could use "post on Instagram three times a week and Facebook two times a week for eight week**s."
4. Assign goal-related tasks to employees
Once you have established the objectives for each short-term goal, assign each objective to an employee or team of employees who will see the objective through to completion.
5. Measure progress regularly
Regularly measure the progress of your short-term goals to ensure you are on track to meeting them in the time frame you established. For example, if you increase your social media posts to three times a week as part of a business goal, measure any increased customer/potential customer interaction you receive as a result. Keep track of the progress and adjust your objectives if needed to better meet your goals.
Examples of short-term business goals
Here are a few examples of short-term business goals:
- Increase product prices by 3% over the next three months.
- Hire three new marketing employees over the next five months.
- Increase traffic on your company's blog.
- Implement monthly giveaways for customers on social media.
- Begin an "Employee of the Month" award program.
- Select a charity to begin sponsoring.
- Create a profile on a new social media channel.
- Increase social media posting to three times a week.
Related: How to Set and Achieve Goals
How to set long-term business goals
In addition to the steps mentioned in the section on how to set short-term goals, you should also include these steps when creating long-term business goals:
- Establish the goals you want to accomplish over the next 10 years.
- Prioritize your long-term business goals.
- Break down each long-term goal into short-term goals.
- Track your company's long-term goals regularly.
1. Establish the goals you want to accomplish over the next 10 years
The first step to creating long-term business goals is to determine the goals you want to accomplish over the next several years. Many people find that setting goals 10 years out is sufficient; however, you can set goals as little as one year out or as far away as 20 years. Identify and write down as many goals as possible that you want your business to achieve in the time period you decide on.
2. Prioritize your long-term business goals
Many companies have several goals that they want to accomplish in the long-term. However, it's difficult to focus on every goal at once. For this reason, it's important to prioritize the goals that you want to focus on first and put your company resources into accomplishing those before moving onto other goals.
3. Break down each long-term goal into short-term objectives
Similar to how you break down short-term goals, you will also need to break down your long-term goals into actionable short-term objectives. For example, if your long-term goal is to increase your company's overall brand awareness, you will need to break this down into short-term objectives that will ultimately help you accomplish the long-term goal. Examples of actionable objectives for the above goal would be to post to social media three times a week and collaborate with social media influencers on a monthly basis.
4. Track your company's long-term goals regularly
An important component of accomplishing long-term goals is tracking them on a regular basis. Because long-term goals can take an extended period of time to reach, it can be easy to forget about them or lose sight of the end goal. Keeping track of the progress being made towards each goal can ensure you're on the right path to reaching these goals and enable you to make any adjustments when needed.
Examples of long-term business goals
The following are examples of long-term business goals:
- Increase the total income of your company by 10% over the next two years.
- Reduce production expenses by 5% over the next three years.
- Increase overall brand awareness.
- Increase your company's share in its market.
- Open three new office locations throughout the United States.
- Hire 50 new employees nationwide.
- Develop and launch three new products.