Business goals are critical for you as a small business owner. They will direct you into the path of succeeding in the business. It could be very frustrating when you set business goals, working hard to achieve them but not progressing in your business. This post will cover three mistakes that avoiding will help the business's progress.
Setting a business goal that does not impact even one of your business metrics
How would you feel if you set a business goal, worked hard on it, and reached that goal, but in the bottom line, nothing changed in your business metrics, you didn't increase the revenue or reduce your cost, you didn't get more customers, and still, you worked hard and even spent money to reach that goal. If that happens to you, probably, you set the wrong goal.
For example, you have a physical store and want to start selling online. You set a business goal of creating a new website for your business, you thought about the concept you want, you paid an agency to do the work, the website is live, and no one buys anything online from you.
To avoid this mistake, choose the business metrics you want to take forward when you set the business goal to be the desired improvement of that metric, the result, and not create a new website, which is the action to achieve that result.
In our example, the desired result is increased revenue from online activity. Creating a website is just one action to achieve this result. You can choose to grow it by percentage or in absolute numbers. The business goal might be increasing the online revenue to 5000$ by the end of this quarter.
Setting a business goal that might hurt other business metrics
The business goal puts a spotlight on one aspect of your business. While pushing that aspect, other factors might become worse. It does not happen because the goal is terrible. It happens because you did not balance this goal with different business goals.
For example, you have a physical store with existing online activity. The proportion of the revenues is 10% online and 90 offline. You want to increase the online portion to 30% since your margins online are better. It's great if you added the extra 20% on top of existing revenues, but if you reduced the offline income significantly, you might have fewer revenues and still reach your goal.
To avoid this mistake, you should set a higher-level business goal. The goals will have a structure with the notion of child and parent goals. The parent business goal will try to push the border aspect of the business, while the child business goal will help move the parent goal forward.
In our example, setting parent goal of increasing the total revenues will make sure we continuously push forward the revenues while the child goal will be to increase the online revenues, the parent goal will save you from hurting the revenues and the child goal will push the online revenues.
Setting a business goal without tracking its progress
The work on business goals is composed of a lot of tasks. If you are not tracking your progress, you might miss your goal. That work is a dynamic process almost always, you can only assume the right path to reach that goal ahead, and usually, you need to adjust the route along the way.
For example, your business goal is to increase online revenues by 20% but you not tracking the goal's progress. You will spend money on online marketing. When working on online marketing, you will think about driving traffic to your website. You might increase visitors to your website, but not all of those visitors will convert into purchasers, and thus your revenues will not increase as you expected.
To avoid this mistake, you need to track your progress at least weekly to check whether the tasks you did in the previous week helped to move the needle or not. You can do it in a notebook, excel sheet, or dedicated platform like Goalskeeper.io to track your progress. It will help you understand whether you are on the right track in real-time.