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Thursday, 22 June 2017 14:56 Written by

 

 

Developing goals

(Part 3 of our strategic planning series)

 

In Part 1 and 2 of this series we looked at how strategic planning can help you assume a proactive position for your business and we worked through the early stages of the planning process.  If you missed those articles you can access them here and here.

In Part 3 of this series we’re going to move on to the next stages of the process - setting meaningful goals to execute your plan.  We’ll then take a brief but important look at the importance of monitoring and managing your plan.

 

Goals and Action Plans

 

Setting and achieving goals is the common feature of successful companies and is a critical element in your Strategic Plan. When we set short terms goals we are breaking down our strategy (long term goals) into relevant, measurable and attainable elements.  Goals connect your business strategy to your results and are vital to keeping you moving in the right direction.

 

Helpful tips on goal setting

 

  • Goals must be attainable but don’t set goals that are too easy to achieve.
  • Goals must be easy to understand.  If goals need explanation then they are not clear enough so remember to keep it simple.
  • Goals should reflect the critical aspects of your business.
  • Too many goals will dilute the focus of the business, too few will not create enough focus.  Experts recommend that between three and seven goals should be developed.
  • If the achievement of a goal can’t be measured then it is not a good goal.
  • Great goals are outcome focused so consider what it is that you really want to achieve.
  • Consider what the consequences will be for not achieving the goal.

 

What kinds of goals should your business be setting?

 

Organisational goals can be thought of as a wish list.  They are established to accomplish your business’ mission or vision and are statements of an end result, achieved in a specified period of time at a specific level of quality.  Goals could be developed around some of these areas:

 

Market share

Growth

Diversification

Customer service

Market positioning

Image

Product / service development

Geographic coverage or expansion

Innovation

Productivity

Return on investment

Social responsibility

Technology

People

Ownership

Management and administration

Marketing

Competitiveness

 

 

Setting SMART goals

 

Keep in mind that great goals are SMART goals. A SMART goal is able to be translated into the key activities which are required to accomplish the goal.

 

Specific – so you know exactly what you are expecting to achieve

Measurable – so you can assess your progress

Achievable - so the goal is within reach given where you are now

Relevant – the goal is focused on the right thing and in line with your vision

Time-bound – so you have a deadline for completion

 

Turning your goals into actions

 

Once your goals have been developed, supporting action plans need to be put in place.  Action plans detail the specific steps you will take to carry out your goals and they assign responsibility and accountability to a member of your team.  In essence, your Action Plans define what must be achieved and by when.  Keep in mind that while one goal may result in more than one Action Plan, all Actions Plans should support a goal.

For example, a business goal may be to “improve the financial performance of the business.”  The goal can be measured, it is achievable and it is relevant.  An Action Plan, or a few Action Plans, could be developed around this goal to bring more focus and specificity to it. 

Some possible Action Plans for this goal are:

  • Reduce Accounts Receivable collection from current 56 days to 45 days by 31/12/17.
  • Reduce Inventory from current level by 10% by 31/12/17.

These example Action Plans show that the goal can be brought into focus by setting specific targets which will help “improve financial performance.”  The Action Plans are also easily measured and provide greater accountability by setting a date by which the targets need to be reached.

 

Action Plan Criteria

 

A good Action Plan sets a key activity required to accomplish a goal.  Keep in mind that Action Plans:

  • Provide a timetable for activities
  • Determine the resources required
  • Identify who will be responsible for carrying out the activity and set a date for this to occur by

Example action plan worksheet which you can use as a template for your business goals:

 

Business Goal:

“To improve the financial performance of the business”

Measure of success:

Reduce Accounts Receivable collection from current 56 days to 45 days by 31/12/17

Actions required to achieve this goal:

Investigate further payment options we can offer to customers

Responsibility:

Jane

Due Date:

31/07/17

Review time requirements for earlier collections process

John

31/07/17

Put in place a process for collections

Jane

15/08/17

Review training requirements for Accounts Receivable staff

John

15/08/17

Provide further training for Accounts Receivable staff

John

31/08/17

 

Strategic Planning Stage 4 – Document your plan

 

Once you have completed Stages 1 to 3 it is time to turn your hard work into a document that can be distributed to key personnel in your business for ongoing management and review.  Here is a checklist for what to include in your Strategic Plan document:

 

1

Internal analysis findings

2

External analysis findings

3

Vision Statement and Mission Statement

4

Your business goals

5

Action Plans for each of your goals

 

Strategic Planning Stage 5 – Execute and monitor your Plan

 

Congratulations! You’ve put in the hard work to develop a Strategic Plan for your business but what really matters now is how well your Plan gets implemented and monitored.  This is where most businesses fall down in any planning process.  They start with good intentions, but lack the follow through to ensure a plan gets fully implemented and observed.

Instilling accountability is imperative and there are a couple of approaches to this which you might consider.  Written progress reports on a regular and pre-defined basis can be effective but perhaps the most effective method is to conduct periodic meetings to assess written reports and received verbal reports.

Ultimately, the key factor in successful implementation of your Strategic Plan will be your commitment to follow up and follow through.

Some questions to consider in your follow up sessions:

  • Are we doing what we said we were going to do?
  • Is what we said we were going to do still appropriate?    
  • How much have we progressed towards our goals?
  • What new information have we got and does it alter our plans? 

Your Strategic Plan is a vital asset in your business success plans.  That you have chosen to undertake this process is an indication that you and your business are committed to long term viability.

Developing a Strategic Plan is not difficult and does not need to be particularly time consuming.  In fact, keeping the process simple and keeping it moving will be a lot easier if the development process isn’t encumbered by unnecessary detail or endless discussion.

Marsh & Partners advisors are experienced strategic planning advisors.  If at any time you need assistance, or simply need clarification that you are on the right track, a Marsh & Partners advisor can guide you through any stage of the process.

Good luck and good planning!

 


 

 

 

 

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