In their quest for business success, entrepreneurs are usually quite willing to experiment, testing new methods, philosophies and technologies in the hope something might fast track their growth, or elevate their visibility. But there is one fundamental area that is often overlooked: goal setting.
Our goals don’t only exist in the future; they define how we work, they affect the decisions we make and they can form part of our daily motivation.
Those who live and work by goals will know just how powerful they can be. Sometimes, the simple act of speaking a goal aloud is enough to make it happen, because goals inform our actions. And, in fact, a famous study by a psychology professor at the Dominican University of California, Dr Gail Matthews, found that people were 42% more likely to achieve their goals and dreams, just by writing them down on a regular basis.
It flies in the face of advocates for a ‘see how things go’ approach, and JRR Tolkein’s famous line in The Fellowship of the Ring: “Not all those who wander are lost”. While flying by the seat of your pants can be great for vacations (and hobbits), it’s an attitude to avoid when growing a business, as we shall learn.
A summary of decades of research found that in 90% of the studies, specific and challenging goals led to higher performance than "do your best" goals or no goals at all.
There is more to setting goals than just ‘setting goals’. For a start, you have to strike a balance: goals have to live within the realms of possibility, while not being too easy. While lofty long-term ambitions can be fine, it’s better to complement those with some more easily attainable short-term goals to keep you motivated.
Also, goals should be personal. No-one else can tell you what success looks like (perhaps the only exception to this rule being investors deciding for you) because we all start businesses for different reasons and it’s highly subjective.
You might have started your own business for wealth, or you might have done it to earn less than you did as an employee but gain a more relaxed work life. You might be chasing rapid growth and a swift exit, or you might be building a reputable lifestyle business that ticks along for 30 years. While the goals may be different, the philosophy and mindset behind goal-setting don’t really change.
There are different methods to try (and we’ll be running through them in this guide), but there is a solid set of tried and tested rules that can be applied. Read on for more...
What do our goals say about us?
“Setting goals is the first step in turning the invisible into the visible.” - Tony Robbins
One of the most enduring definitions of goal-setting for individuals is the 2x2 achievement framework that was developed by following extensive research by Eliot and McGregor in 2001.
They hypothesized that people fall into certain goal-setting profiles that influence the way they set targets and motivate themselves to work. You might recognize yourself in some of these!
A person who wants to improve their knowledge and abilities in a certain area for the sake of improvement and the benefits that brings.
Striving to do something in order to not feel like a failure. This can lead to a ‘just doing enough’ approach to certain goals.
When you set goals relative to others with the aim of being better than them.
When someone strives to not be seen to fail. This can lead to individuals avoiding challenges and being afraid to admit when they don’t understand.
It’s really useful to pause and reflect on these.
It is a great thing to have big ambitions, but effective goal planning comes from understanding what our own measures of success are, the ways that we work and what we’re driven by.
Once we understand ourselves better, then we can set appropriate and effective goals that motivate us.
The data zone
Here is a collection of some of the best research on the impact and importance of effective goal-setting on all kinds of activities:
When tasked to save on energy consumption, individuals who set challenging but attainable targets were more likely to succeed than individuals committing to easier targets, who were more likely not to change their energy consumption at all.
Goal setting is a particularly effective way to change behaviors and goals become more effective when they are (a) difficult, (b) set publicly or (c) set as a group goal.
Making a plan to accomplish something and noting it down makes you more likely to accomplish that task than not doing so.
A review of dozens of studies found that reckless and poor goal setting can lead to distorted risk preferences, a rise in unethical behavior, inhibited learning, corrosion of organizational culture, and reduced intrinsic motivation.
Set the right goals
“To the person who does not know where he wants to go there is no favorable wind.”
The data above suggests there’s a right and a wrong way to set goals. For example, they must be neither too easy nor outside the realms of possibility.
A really useful method to apply here is S.M.A.R.T goals, something we’ve covered here before at the Achievement Institute.
Let’s quickly recap what S.M.A.R.T. stands for:
- Specific: Your goals need to be clear and well defined. Instead of goals like “I want more money” or “I want more customers”, you should go a step further: “I want to increase our annual turnover by $100,000 within three years” or “I want to have 20 new customers by the end of the fourth quarter”.
- Measurable: How will you track the progress of your goals? New customers per month? Unique site visitors? Customer loyalty? Think about your units of measurement, whether that’s dollars, or number of users, customers or employees.
- Achievable: It’s all very well to push yourself but do you truly have the means to pull it off? Are there any factors outside of your control that could stop you from reaching your goal?
- Relevant: Does your goal reflect your hopes and how you view success? For example, do you really want to lead a large business, or would you actually be happier keeping it small and agile so you can focus on the work you really enjoy? By making sure your goal is relevant to your measure of success, it will be worth devoting energy and resource.
- Timely: Make sure your time-frame to deliver on this goal is realistic by asking yourself why you think is doable. Conversely, don’t set the limit to be so far in the future that it never feels like something you work towards in ‘the now’.
Use SMART to stress test your goals, and tweak them if needs be.
"The power of goal setting never ceases to amaze me. Sometimes it seems as though if you simply visualize where you want to be, the stars align. In reality, there's a whole team of us pulling together to make these things happen, but knowing what you're working towards is incredibly motivating. Without goals, there is a risk of coasting.
"It seems to be that once the vision has been spoken and visualized, as long as awareness is maintained things start moving in that direction – sometimes not straight away and sometimes not in an obvious way but so many times I've realised that we've achieved the things we set out to because of a goal set way back in the distant past.
“Sometimes I get frustrated at lack of progress towards goals but I've learned to relax a little because more often than not we end up moving towards them regardless of whether we know we are!"
- Barnaby Lashbrooke, CEO and founder of Time etc
Balance long and short term goals
“Success is the progressive realization of a worthy goal.” - Earl Nightingale
Productivity book, The Hard Work Myth, outlines brilliant advice on the importance of having lofty long term goals as well as shorter goals that are more easily reached.
These are referred to as BIG goals and NOW goals.
The BIG goal is your strategic vision, your long-term ambition e.g. growing your business to $3M revenue.
This goal serves as a reminder of your direction and how much further there is to go. It can also help a business owner to justify investments in people and systems, for example.
But what, a BIG goal doesn’t do, is show you how you’re going to get there. That’s where the NOW goal fits in. This is a goal that’s attainable within the next few months e.g. to amplify marketing and advertising with a hard-hitting social media campaign, to double the sales team, or to secure five new clients.
The rule is that this goal must directly contribute to achieving your BIG goal and it must be quantifiable, such as a revenue figure, an increase in customers, or a sales target, that can function as a clear marker of success.
How often do you make daily or weekly goals without ever really considering your long-term future? Striking a balance between the attainable and the ambitious is a hard line to walk, but it can stop distant goals from becoming de-motivating.
It can be helpful to set a calendar reminder to revisit your BIG goals every month or quarter to ensure your long-term objective stays present and relevant.
Get others involved
"Coming together is a beginning. Keeping together is progress. Working together is success." - Henry Ford
Perhaps the most overlooked factor for creating motivating and successful goals is the value of communicating with others and setting effective group objectives.
Entrepreneurs answer to no one, that is part of the appeal, but that doesn’t mean you should try to go it alone in all aspects of your work.
When you incorporate others into your plans and let them know what you are working towards, you create a sense of accountability that can keep you focused and motivated.
People have a 65% chance of meeting a goal after committing to another person. Their chances of success increase to 95% when they build in ongoing meetings with people who check in on their progress.
Articulating your objectives has a few valuable benefits. If you speak your aims out loud, they’ll suddenly seem more real and you’ll be better able to judge whether they’re remotely attainable.
Your friends and colleagues may also offer feedback, and highlight possible hurdles you might have missed.
And lastly, if you share your vision, you’ll have people to check in and hold you accountable for your goals.
And, if you have employees, sharing your business goals with your team is a no-brainer: everyone will be motivated and directed by a common goal.
Some companies write their goals on the wall and revisit them daily, weekly or monthly. It’s a process called ‘vision boarding’.
A dream board or vision board is a collage of images, pictures, and affirmations of one's dreams and desires, designed to serve as a source of inspiration and motivation.
Now you have your goals… what next?
Now it’s time to swap working harder for working on the right stuff. You need to start being picky about the tasks you take on. It’s very easy to jump straight in and start doing, rather than taking the time to pause and think “should I really be working on this?”. But your time and energy are finite.
Start by writing a mini job description that lays out the types of tasks that will directly help you achieve your NOW goals and your BIG goals. Everything else should be treated as a potential distraction.
Every time a new task demands your attention, work out whether it’s a task or a distraction by asking yourself these three questions:
- Would doing this task directly help me reach my goals?
- Does this task fit with my list of tasks to focus on?
- Will something bad happen if I don’t do it?