Goals are developed from the SWOT analysis. This is not a wishful thinking. Goals describe objectives that are specific with respect to magnitude and time. A goal is a realistic, measurable, time-dated target of accomplishment in the future. Why goal formulation so important thing for strategic planning? Strategic planning is a process that determines the future of organization. Goal formulation determines resource allocation needed. Having a proven process for strategic planning and goal formulation makes the effort more efficient.
This assures that a strategic plan will provide a frame that will shape a company’s future.
Goals formulation converts the company’s mission, objectives, strategic vision to specific performance targets, something the company’s progress can be determined. All goals must be stated in quantifiable or measurable terms, contain a deadline for achievement. Let’s consider a goal formulation process in terms of mobile restaurant business with food to-go, which is popular in the United States but still not presented here in Kazakhstan.
Worldwide crisis gave a way to this specific business where not only professionals – chief cooks that has been fired or lost their business due to being unprofitable – even simple ex-office clerk who lost job during recession can run it. Cooks prepare and sell food right on the street where truck parked. The main goal of every business is to generate profit. However, the goals of every business change, depending on the type of industry they are in, the demands of the market, the current condition of the market.
To be specific When setting business goals, entrepreneur should keep in mind that specificity is really important to visualize exactly how the end result would be. For example:” Generate sales of $ 500 000 after running my mobile restaurant entity for year” is more specific goal, than simple “I want to be rich”. Then, one more specific goal is how much “branches” with me – “trucks”, I wish to have after a specific number of years, the exact number of employees after a year, the exact number of customers I regularly have on a daily basis.
To be measurable This aspect of goal formulation is tied up with specificity. I need to have a unit of measurement to determine how close I am to my goals. For example, during measuring financial status, I need to measure sales, expenses per day. To be Attainable A good approach is to divide a huge goal into smaller objectives to help entrepreneur achieve through smaller steps. Setting realistic goals, based on personal capability, the current workforce and the resources available in the company.
To be Realistic To know how to set right goals, I have to check current capabilities and resources first, check how well the business is doing and do a thorough evaluation before setting business goals. For example, I can check how many customers I have, how many total sales generate per day, then make goal formulation on the daily basis. I have to be careful about the current situation on the market, as well as the demand for particular product service. Another thing is to create marketing scheme, which helps make goals more realistic.
To be “Time-bound” Business goes on as long as I have enough resources and manpower to sustain it. This is a ideal marketing to set goals on a daily, monthly, quarterly and yearly basis. I suppose setting huge goals in a short interval of time can lead to unreal and unattainable results, still setting small goals over a long period of time can lead to delay and wastage. Set task and use enough time for accomplishment for business to grow. Business plan includes goals formulation in its first part.
This is really important for businessman, especially if he seeks an investor. It’s extremely significant to look narrowly at goals of the business over at least one full year. Entrepreneur should do a monthly review of business to identify which goals have been accomplished. After year, recheck and adjust everything. A business will go on to progress as long as there are available goals and objectives. Even if business doing well, setting new goals and working with the trends must take place.