Business Goals Examples, Definition & Importance | Full Guide 2023
Published: 25 June, 2023
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On the surface, Business Goals are simple: make enough money to run the business, expand as necessary, and provide for the people who own and operate the organization. Like a living organism, a business’s main goal is to survive and thrive.
But how do we achieve that? The broader goal of surviving is built upon smaller and more specific Business Goals that direct your strategy over a period of time as part of the strategic planning process.
Business goals are of paramount importance for several reasons, as they serve as a guiding force that directs an organization’s efforts, decisions, and strategies. We at Digital Leadership provide Business Model Strategy services and Digital Strategy Consulting to help you align with your business goals, ensuring that your path to success is well-defined and your strategies are optimized for achieving those objectives.
In this article, we discuss the variety of Business Goals you might choose to target to help secure your business’s survival and growth as part of the strategic planning process. You should be able to identify some goals that are specifically helpful for your business and begin the process of developing strategies to reach them as part of the strategic planning process
What are Business Goals?
A Business Goal is a target an organization wants to hit either in the short term or in the long term. You can think of a Business Goal as an endpoint or accomplishment the organization sets for itself in a given timeframe.
As we’ll see throughout this article, most Business Goals focus on advances like revenue, market penetration, growth, or shareholder value creation. But every business will have its own specific business goals.
Business Goals are written to be aspirational, without any indication of the specific strategies that the company will enact. Those plans are called Business Strategies and are developed after the company chooses its larger goals.
Business Strategy —the actual activities that an organization undertakes in order to meet its goals—is the topic of another Digital Leadership article that you might find helpful.
Business Goals vs. Business Objectives
Understanding how experts differentiate Business Goals from Business Objectives will be helpful as you define your business strategy.
A Business Goal is a long-range outcome that your teams use to help define strategies. A Business Objective is a short-term action you’ll take to help reach an overall goal.
Goals and Objectives combine to form your overall Business Strategy, or in other words, the map of what your company will do in the future in the hopes of achieving success in the priorities you’ve identified.
Many times, Business Goals and Business Objectives are terms used simultaneously and interchangeably. Understanding the distinction makes it easier to visualize the entirety of your business strategy.
Why Setting Business Goals is Important to Every Company?
Strong Business Goals are an important element of the overall package of documents that direct a company’s activities and priorities. Other pieces of that package include a Business Strategy, a Mission Statement and Vision, and the company’s Massively Transformational Purpose.
Business Goals give your organization a target. They articulate priorities and motivate employees. Business Goals make your company’s purpose clear.
Let’s look a little more closely at the power of Business Goals in motion.
(1) Goals Give your Business a Direction
Getting Business Goals onto the page or screen gives your organization a sense of direction. It facilitates the entire operation pulling for the same goals.
(2) Goals Give you a Way to Track and Measure Progress
Business Goals give defined metrics that you can track so you can measure your success and progress. They allow you to recognize failure so you can fail fast; a major element of innovation is making many iterations quickly so you increase the odds of success.
Because your Business Goals give clear, measurable touchstones, the entire organization, at every level, knows how their efforts are contributing to the business’s purpose.
(3) Goals Help you Stay Motivated
Who runs a race without a finish line? Business Goals are that finish line. It’s much easier to stay motivated when you know what you’re working toward. Since a business works as one unified organism, the goals work the same way for the combined organization.
Incidentally, this is why a series of smaller goals can be more effective than one larger goal. The energy we feel in reaching a goal powers us toward the next.
(4) Goals Help You Achieve Quicker Growth
Business Goals help you achieve quicker growth because they focus your efforts. Our experience indicates that commitment is an indicator of success. Since articulating Business Goals encourages deeper commitment, it follows that businesses making use of them would experience more positive outcomes.
Goals keep your team accountable. They force consideration of priorities and practices, which in turn help achieve quicker growth.
Our comprehensive book, ‘How to Create Innovation,’ offers in-depth guidance on developing a strategic business plan that is primed for innovation and geared towards achieving exponential growth. It provides valuable insights into how to leverage the Business Model Canvas to optimize your business model, enhance your value proposition, and drive exponential growth.
Types of Business Goals
Depending on where your business is currently, and where you want it to be heading, you will choose your Business Goals from a set of four types.
Each type of Business Goal has its own advantages, and some of each of their characteristics overlap. Each of these types of goals can also vary in scope quite a lot—how you choose to articulate them will, again, depend on the specifics of your business’s current situation.
(1) Time-Based Goals
Every goal needs an endpoint. Deadlines focus the work your organization is doing and make reaching the goal much more likely. We believe that every Business Goal needs a target date, articulated within the context of the goal itself.
For a Time-Based Goal, the deadline takes center stage. Often, the accomplishment set forth in your goal has a deadline impressed upon it by outside forces: some presentation, governmental requirement, or new product roll-out, for example. The length of time you’re given to complete the goal determines what sort of specific Time-Based goal you’ve built.
– Short-Term Business Goals
Short-term goals are often used in conjunction with longer-term goals. They give the opportunity to celebrate reaching the endpoint more frequently, which makes short-term goals an excellent tool for motivation.
– Long-Term Business Goals
Long-term goals let you tackle large projects. These goals can last months, or even years, which is why short-term goals remain useful. Don’t lose sight of the finish line with these long-term goals. Find an opportunity to celebrate success incrementally.
(2) Goals Based on Performance
Goals based on performance are short-term targets identified as important for ongoing success.
Key to Performance-Based goals are reachable targets within appropriate timeframes. The metrics being used must also be clearly defined and easy to evaluate.
(3) Quantitative & Qualitative Goals
The difference between a Qualitative and a Quantitative goal is the type of data you’re collecting when you measure your success.
Quantitative Goals require collecting factual data. Typically, we think of quantitative data as originating in numbers or statistics, but all data can be used in statistics eventually. You can think of quantitative data as provable measurements, often very tangible.
On the other hand, Qualitative Goals are built around impressions and degrees, usually how someone feels about something or how they might describe an experience. Because these measurements can be harder to collect and the goals harder to define, managers must be careful with using them to determine employee evaluation results.
We recommend focusing on quantitative goals with a small dash of qualitative to help gauge consumer response and team member attitudes.
(4) Outcome & Process-Oriented Goals
The success of Outcome-Oriented Goals is determined by how and when your team reaches a certain goal. Outcome Goals are a pass/fail situation. Either you reach the desired outcome, or you don’t.
The success of a Process-Oriented Outcome is less specific. Instead of a desired targeted endpoint, a Process-Oriented goal requires the completion of a set of steps regardless of the outcome.
One way to think about the differences here is the classic line “It’s the journey, not the destination that matters.” A Process-Oriented goal favors the journey. For an Outcome-Oriented goal, the destination is everything.
Business Goals Examples
As we said previously, Business Goals will always be specific to the organization’s priorities, situation, and business model. There are some examples of common Business Goals that we can review, however, because it’s productive to review what successful businesses have done in the past.
Below, we provide a short description of each Business Goal example, as well as some thoughts on how it would look in practice for your business.
In each description, we mention how the goal is most likely to be positioned within your organization.
(1) Improve Your Company and Brand Reputation
Typically a long-term goal, improving your standing in the marketplace requires a qualitative approach to collecting responses from your customers and potential customers to understand their feelings toward your organization.
(2) Develop a Business Plan
This a short-term Business Goal that should be addressed early in your business’s lifespan.
(3) Improve Product or Service Quality
This is most likely a goal that will have short- and long-term steps on the way toward an overall improvement.
There is an aspect of qualitative data in this Business Goal, obviously, but you should try to quantify the improvement in quality as much as possible by comparing customer responses over time to track growth and highlight where there’s work still to be done.
(4) Achieve Higher On-Time Delivery
For this goal, you’ll need to decide a time frame based on your specific needs. Perhaps, for example, you want to improve delivery during the holiday season. That would be a short-term Business Goal.
If you’re looking to improve delivery over time, your goal might be focused on Outcomes, hitting certain percentage benchmarks.
(5) Increase Customer Satisfaction
Another example of a Business Goal that requires the collection of qualitative data, is you can choose to make a short- or long-term goal depending on your business’s needs.
We tend to think that customer satisfaction should always have a role in what you measure to track business success.
(6) Improve Customer Retention
A mid to long-term Business Goal is usually measured through Outcomes, hitting certain metrics of returning customers or converting them into long-term contracts.
(7) Increase Sales Volumes
Another mid- to long-term Business Goal, increasing sales values uses quantitative measurements to determine if the business hit target Outcomes goals.
Instead of overall Sales Volumes, some businesses measure overall profit or average profit margins of goods and services sold.
(8) Optimize Product and Service Pricing
This long-term goal requires consistent monitoring of your profit margins and your customer’s perception of the value you’re providing, along with a review of competitive pricing.
(9) Increase Market Share
This is clearly a mid to long-term quantitative goal.
Our experience tells us that the more targeted you can be here, the more productive improvements can be. Select a specific segment or product type and focus your efforts there.
(10) Improve Profit Margins
Another finance-based Business Goal, increasing profit margins is long-term, with several targeted earlier deadlines used to measure and promote success.
Improving margins may be a long-term goal that uses several of the other goals listed in this article to help achieve success.
(11) Increase Profits
Increase sales, increase margins, reach into new markets—ultimately, many of these goals are driving a move toward increased profits.
Many businesses make sustainably increasing profits a long-term goal. The exact metrics used to measure this, as well as the target benchmarks they need to reach to be successful, vary greatly from one organization to the next.
(12) Develop New Customers
Measure how many new customers you acquire over a given time. This is likely a mid to long-term goal that requires close measurement of who is buying your product or service.
(13) Expand Into a New Geographic Market
Expansion is a long-term Process-based Business Goal. This goal is clearly very specific to your business because it’s dependent upon so many different factors, including current location, desired expansion, and Business Model.
(14) Market Through a New Channel
Like all Business Goals focused on expansion, finding new channels is a Process-Oriented goal.
The wording of this goal is easily changed to move from Process to Outcome once you advance from merely wanting to market through a new channel to actually quantitatively measuring your sales.
(15) Develop A New Product or Service
A mid to long-term goal of developing a new product or service is Outcome-Oriented, but there will be a number of smaller Process-Oriented goals along the way, most likely.
You’re also likely to transition to other quantitative goals that measure the success of your new products and services. They need to exist first, of course!
(16) Implement an Employee Development Program
A simple development program might be implemented fairly quickly, but a rigorous program that tracks how your employees progress is a long-term goal that requires a lot of effort. We believe a development program pays dividends in the long run by making it easier to retain quality employees and grow a pipeline to senior management
(17) Increase Employee Satisfaction
This is a goal that can span any timeframe, depending on the business’s needs but is more likely to focus on mid- to long-term qualitative measuring. This goal’s metrics can slide into the quantitative when you collect data about employee longevity and retention.
(18) Decrease Expenses
An Outcome-Oriented goal, decreasing expenses can occur over any amount of time you choose. You may consider being more targeted and aim to decrease certain expenses by a given date.
(19) Implement Productivity Improvements
For this goal, you’ll need to select quantitative metrics for productivity. Since every business is different, you’ll decide what measurements work for you.
For example, you may be holding your productivity to a very high standard. LEGO, for instance, has famously rigorous quality standards.
Productivity improvements are usually long-term goals, with several medium- and short-term goals used to motivate and track changes.
(20) Migrate To a New Technology Platform
The adoption of new technology can be a challenging, frustrating goal because so many departments with different priorities are involved. In order to successfully reach this goal, you’ll rely on a combination of qualitative and quantitative metrics.
A deadline will be important, along with the functionality of the new technology. In some instances, the aesthetics of the technology will play an important role in the measuring of success.
Is a partial roll-out all right? A soft opening? Do you need complete functionality on day one? How compatible must the new technology be with the previous tech?
These are all important elements that should be articulated as part of your overall Business Goal.
(21) Make Investments for the Future
How big will your investments be? What will they look like? How far into the future are you aiming for?
We see investment as a mid-to-long-term goal. Consider if you’re collecting cash to have on hand, acquiring the latest equipment, or performing routine maintenance on your building. These activities, and far more, would count as sensible investments for the future.
(22) Increase Shareholder Value
Publicly traded companies are required to grow their shareholder value. Privately held companies may still have stockholders in other capacities, so improving their standing is always a long-term goal.
Outcome-oriented, the goal of increasing shareholder value should have a benchmark target with a clearly articulated deadline. How much increase, and by when?
– Short-Term Business Goals Examples
- Develop a Business Plan
- Improve Product or Service Quality
- Market Through a New Channel
- Implement an Employee Development Program
– Long-Term Business Goals Examples
- Increase Shareholder Value
- Make Investments for the Future
- Migrate To a New Technology Platform
- Decrease Expenses
- Market Through a New Channel
– Performance-Based Goals Examples
- Increase Shareholder Value
- Decrease Expenses
- Develop A New Product or Service
- Increase Profits
- Increase Sales Volumes
- Improve Customer Retention
– Qualitative Goals Examples
- Increase Employee Satisfaction
- Increase Customer Satisfaction
– Quantitative Goals Examples
- Achieve Higher On-Time Delivery
- Increase Shareholder Value
- Increase Sales Volumes
How do you Choose your Business Goals?
When it comes to setting business goals, having a structured approach is crucial to ensure that your goals are realistic, in line with your overall strategy, and can be measured to track progress. The balanced scorecard is a strategic management tool that can assist in achieving these objectives.
The balanced scorecard connects different aspects of a company’s strategy in a cause-and-effect relationship. This approach enables businesses to ensure that their goals are consistent with their overall strategy and that they are measuring the right elements to achieve success.
Using the balanced scorecard to determine business goals involves several key considerations:
- Use the SMART Goals Framework: The SMART acronym stands for Specific, Measurable, Achievable, Relevant, and Time-bound. Using this framework ensures that your goals are well-defined, easily measured, achievable, relevant to your business model and purpose, and have a specific deadline.
S – Each goal must be as SPECIFIC as possible
M – Each goal must be MEASURABLE, even if you’re aiming for qualitative targets
A – Each goal must be realistically ACHIEVABLE
R – Each goal must be RELEVANT to your overall business model
T – Each goal must be TIME BOUND to a realistic deadline
The SMART Goals Framework prevents the selection of goals that are counter-productive, wasteful, or impossible to achieve. Choosing the wrong goals is worse than having no goals at all: improper goals suck time, motivation, and resources from the areas of the business where they could be better utilized.
- Ensure Goals are Measurable: Each goal should have a method for collecting data that proves progress or lack thereof. Even if the goal is qualitative, there must be a means of measuring progress towards achieving it.
- Ensure Goals are Attainable: Choosing goals that are impossible to achieve is counterproductive. This is especially true for businesses whose organizational strategy makes certain goals challenging to reach. Ensure all the components of your business are working together towards a shared objective.
- Complement your Business Model and Purpose: Select goals that align with your overall business model and vision. Don’t compromise your vision for the sake of creating a list of goals.
Once you have established your business goals using the balanced scorecard, it becomes easier to track progress and make informed decisions about how to allocate resources and improve performance. By using the SMART framework in conjunction with the balanced scorecard, businesses can establish specific, measurable, achievable, relevant, and time-bound goals that are both attainable and consistent with their overall business strategy.
How do you Reach your Business Goals?
There’s no one-size-fits-all guaranteed plan for reaching your business goals, but our experts agree the following strategies give you the best odds for success.
- Commit to your Goals: Don’t let minor setbacks force you to deviate from your well-researched goals.
- Regularly Check Progress: Be on top of your metrics, and automate the measuring process as much as you can so you keep an up-to-date view of your progress.
- Maintain Accountability: Make sure everyone knows who is responsible for which elements of your goals.
- Celebrate Milestones & Achievements: It’s important to identify smaller goals that you can recognize and celebrate.
Connecting The Dots With Business Model Canvas
In the modern business environment of modern business, setting clear and strategic business goals is a fundamental step toward success. Whether it’s increasing revenue, expanding market reach, enhancing customer satisfaction, or improving operational efficiency, these goals serve as the guiding stars that illuminate an organization’s path forward. The Business Model Canvas, a widely acclaimed strategic tool, comes into play. It serves as a versatile and visual platform for organizations to not only define their business strategies but also to align these strategies meticulously with their overarching goals.
- Alignment with Business Goals and Strategy: Business goals provide direction, and the Business Model Canvas aligns them with strategy, ensuring coherence in the organization’s purpose and growth plans.
- Customer-Centric Approach: Goals related to customer satisfaction and growth link to the business model canvas Customer Segments and Value Proposition, forming the basis for business purpose and growth.
- Financial Targets and Strategy: Financial goals tie into the business model canvas Revenue Streams and Cost Structure, crucial for both strategy and financial planning.
- Market Expansion and Reach: The BMC Channels and Customer Relationships support the goals of market expansion and customer engagement, vital for strategic planning and business growth.
- Resource Allocation and Execution: Achieving goals often requires resource allocation, reflected in the Key Resources and Key Activities sections, influencing strategy and execution.
- Partnerships and Efficiency: Goals focused on cost efficiency relate to business model canvas Partnerships and Cost Structure, impacting strategy and efficiency.
- Innovation and Improvement: Goals involving innovation align with the business model canvas Key Partnerships, Key Activities, and Key Resources, reflecting a commitment to improvement in strategy and growth.
- Measuring Success Holistically: The Business Model Canvas aids in measuring progress across goals, informing decisions for business strategy, planning, and overarching business purpose
Frequently Asked Questions
1- What are business goals examples?
Some common business goals include Developing a Business Plan, improving product or Service Quality, Market Through a New Channel, Achieve Higher On-Time Delivery, and Increase Shareholder Value.
2- What is the most important goal of a company?
The most important goal of a business is to sustainably provide value to its customers in a way that secures the business’s long-term future.
3- What are SMART business goals?
SMART is an acronym for choosing quality business goals. It means Specific, Measurable, Achievable, Relevant and Time-bound