Table of Contents
Business goals and objectives are key components of every successful business. If you don’t know what you’re working toward, you won’t know what success looks like. A goal is a large-scale long-term outcome that you work toward, while objectives are smaller, shorter-term, specific stepping stones to help you reach it.
Business goals need to be clear and meaningful if you’re really going to achieve them. Find out the difference between business goals and business objectives, plus how to create a realistic vision for each category.
Key Points
• A goal is the broad vision of success for a business; objectives break down the steps needed to meet the goal.
• There are different kinds of business goals, including financial goals, brand and relationship goals, operational goals, and development and growth goals.
• You can create operational goals for different departments of your business.
• The SMART goal framework helps you set goals by making sure they’re specific, measurable, achievable, relevant, and time-based.
• Regular check-ins help keep you on track with your business goals.
What Are Business Goals?
Business goals are one of the business fundamentals, defining measurable targets over a predetermined timeframe. They can (and should) be created for both the organization as a whole and for individual departments and even employees.
A general goal is one that provides a broad target for the business. It could be written as a mission statement or as a general strategy, but the idea is that all other goals and objectives lead up to achieving this vision. It’s helpful to have this goal defined before writing a business plan.
Specific goals, on the other hand, are ones that you can measure and track. Typically, they contribute to the success of the business’s general goal. For instance, if your business’s overarching goal is to have a fleet of 10 mobile pet grooming services in your city, your specific goals should center on scaling your vans and staff at a reasonable rate.
Recommended: How Do You Structure a 3-Year Business Plan?
Types of Business Goals
As you think about how to grow your business, start by focusing on these four areas.
Financial Goals
There are many different types of financial goals to choose from, and what you choose may vary based on your current stage of business growth. Hitting a certain revenue number is a common one, but don’t forget to consider other financial goals, like reducing operational costs and improving cash flow. Those factors also impact your bottom line and how efficiently you’re able to run your business.
Also consider creating a profit plan, which evaluates your profitability now and in the future. You can easily increase revenue by making large capital investments. But can you cover your expenses? Will you be solvent in a year? A profit plan prioritizes all of these financial goals to improve overall business performance.
Brand and Relationship Goals
Next, consider your branding and customer relationship goals. Brand awareness goals help inform your marketing priorities. Determine what type of audience you want to reach, and create a roadmap to attract them, from organic web traffic and ads to website conversions.
Additionally, consider goal setting in reference to your current relationships. How satisfied are your customers? You could create surveys around satisfaction and track how improving those results impacts customer retention and recurring business.
Operational Goals
Another type of goal concerns your business’s internal processes. Your operations fuel your other goals in the background by making sure systems and employees can work smoothly with as little friction as possible. These goals usually apply to individual departments and have a shorter timeframe than more generalized goals.
What is considered an operational goal? Anything that involves process improvement, best practices, or short-term profitability would typically fall into this category.
Development and Growth Goals
Company goals should also include developmental targets for employees and the entire organization. First, figure out what type of skills your employees will need in order to achieve other business goals. Then look at what kind of IT upgrades may be necessary to support those initiatives.
Finally, consider leadership needs, whether that involves growing staff, training existing leaders, and/or preparing how older leaders can eventually step away without removing that institutional knowledge.
Recommended: Small Business Loans
Business Goals vs Business Objectives: What’s the Difference?
Business goals and objectives work together to achieve success for your company. If your goal is the destination, the objectives are the steps to get there. A goal stretches out over a longer timeframe, while an objective is the work that needs to be done in the short term.
By setting your company goals first, you can then define the objectives you and your team must accomplish in order to achieve them. Objectives should be measurable so that you can determine whether they’re being achieved. With that information, you’ll know whether or not you’re on pace to meet your overall goals as well.
Recommended: Small Business Checking
How to Set Effective Business Goals and Objectives
One of the most well-known strategies for setting effective goals and objectives is using the SMART framework:
• Specific
• Measurable
• Achievable
• Relevant
• Time-based
By making sure that each of these descriptors applies to your goals and objectives, you’ll have a realistic plan with check-in points that let you know what’s working and what isn’t. Be sure key stakeholders and employees meet on a regular basis to assess progress and make adjustments as needed to stay on track.
Examples of Business Goals and Objectives
What does setting business goals and objectives look like in practice? Here are some examples to inspire you.
| Example Goal | Potential Objectives |
|---|---|
| Increase revenue 75% in one year | • Launch a new service or product • Increase average customer revenue • Increase rate of new customers |
| Increase customer conversion rates by 25% | • Optimize and test website landing page • Streamline online checkout process • Increase follow-up schedule on leads |
| Improve employee retention rate | • Conduct quarterly employee engagement survey • Implement professional development plan for full-time employees • Launch employee recognition program |
Recommended: Startup Business Loans
How To Track and Measure Business Goals
Even the best-laid plans need ongoing nurturing in order to fully reach fruition. Follow these steps to monitor and measure your business goal progress.
• Provide milestones for each deadline: Don’t get lost in the race to a long-term deadline. Make smaller milestones that the team can achieve to lead up to each goal’s ultimate finale.
• Schedule regular check-in meetings: A regular cadence of meetings offers visibility into progress, challenges, and roadblocks.
• Create a dashboard report: Having a visual for numbers-oriented goals makes it easy to see when you’re making progress and when a goal is stalling.
The Takeaway
Planning for your company’s growth is exciting, but it takes concrete business goals and objectives to get there. Be clear about what success looks like and what it takes to achieve that vision, otherwise you risk getting stuck on autopilot and feeling unsure about whether you’re actually making any progress.
Ready to grow your business? SoFi Small Business Loans can give you fast access to the capital you need. Check your eligibility in minutes.
FAQ
What are examples of common business goals?
Some common business goal examples include increasing revenue, improving customer satisfaction, and improving employee retention rates.
What is the difference between a goal and an objective in business?
A business goal is the big picture vision you want to achieve. Objectives are shorter-term actions that support the broader goal.
How do you write a business goal?
A business goal should be specific and have a clear timeframe in which it should be achieved. To increase your chances of success, it should also be realistic.
How often should business goals be reviewed?
Business goals should be reviewed on a regular basis, but the frequency depends on the size and timeline of the goals. Shorter-term goals should have more regular check-ins, while longer-term goals could go longer between review sessions.
What happens when business goals and objectives are not aligned?
When business goals and objectives are not aligned, it’s difficult to achieve the outcome you’re looking for. Objectives need to support the goals, which means you should define that goal first, then outline the objectives required to make it happen.
Photo credit: iStock/Nikola Stojadinovic
SoFi's marketplace is owned and operated by SoFi Lending Corp.Advertising Disclosures: The preliminary options presented on this site are from lenders and providers that pay SoFi compensation for marketing their products and services. This affects whether a product or service is presented on this site. SoFi does not include all products and services in the market. All rates, terms, and conditions vary by provider. See SoFi Lending Corp. licensing information below.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
SOSMB-Q226-148