2022 has been a long year, and many are ready to start their next chapter — hoping for opportunities to expand their businesses and rebound from the supply chain slowdowns that taunted us the last 365 days.
Every January 1st is met with a list of goals, and your business is no different. Kick 2023 off by setting SMART small business resolutions full of Key Performance Indicators, or KPIs, that make sense for your company.
Let’s Set SMART Goals
The key to successfully making your resolution a reality is creating a plan that helps you measure progress and meet your goals.
Whether that’s landing more funding for your business or venturing into advertising on social media platforms, to ensure goals are both clear and attainable, they must be: Specific, Measurable, Achievable, Relevant and Time-bound.
If your goals aren’t clear and specific, you won’t be able to focus your efforts or feel truly motivated to achieve them. Keep them simple and sensible but also significant.
When crafting your goal, lean on the five “W” questions:
- What am I looking to accomplish with this goal?
- Why is it important?
- Who else is involved or impacted?
- Where will it take place?
- Which resources will be included?
You can’t expect to track or stay on top of your progress if your goals are not measurable. Regularly checking in on goal progression will also keep you motivated as you push toward the deadline.
Your goal should be able to answer questions like:
- How will I know I’ve reached my goal?
- How many/much should I have?
In the Specific paragraph, we touched on being sensible. If your goal isn’t achievable, you’re wasting your time. It’s OK to dream big; however, surpassing a big-box brand’s sales in your third year in business might be a bit lofty.
You’ll know your goals are achievable if you can answer:
- What steps do I need to take to reach this goal?
- Is this realistic based on where my company stands with staffing, finances, etc.?
Any goals set should align with your company’s objectives as well. Because you’ll need the support of your staff to make it happen, you’ll want to be sure this goal is driving your business toward growth and not simply creating busy work for the team.
Check yourself by asking:
- Is right now the best time for this?
- Is this goal worth it?
- Does it line up with my business’s needs?
- Is it in line with my company’s mission?
Let’s talk about deadlines. While they’re stressful, they are what keep you on track to reaching your goals. Keep your plan on track by asking yourself:
- When should I be done with this goal?
- What should be done each quarter to reach this?
By detailing what you set out to do, you increase your chances of completing your goals.
Studies show 76% of people who wrote down their goals, made a list of goal-driven actions, and provided weekly progress reports to a friend achieved their goals — which is 33% higher than those with unwritten goals—Dominican University of California
What are KPIs?
Key Performance Indicators are the targets that keep you on track. They support your business’s strategy and goals. Without KPIs in place, you’ll likely look back on the years and realize there are several boxes that went unchecked.
Not sure which KPIs are best for your business?
- New clients per month
- Revenue collected monthly
- Revenue billed monthly
- Monthly expenses
- Client satisfaction scores
- Employee satisfaction scores
Example: Increase the number of cases closed by 10% by EOY.
- Effective labor rate
- Hours sold per repair order
- Client satisfaction score
- Client retention rate
- Parts to labor sales ratio
- Employee productivity and efficiency
Example: Decrease average time spent working on cars by two hours by EOY.
- Cost of customer acquisition
- Customer retention
- Operating costs
- Travel productivity
- Response time
- Loss and profit
- Safety quality
- Client satisfaction
Example: Decrease lost work days due to accidents by 10% this year.
- New guests per month
- New client retention
- Repeat client retention
- Visit frequency
- Guest spending average
Example: Increase guest spending average by $5 quarterly.
Child Care Services
- Leads to new student percentage
- Student turnover rate
- Employee turnover rate
- Revenue per student
- Monthly expenses
Example: Reduce employee turnover by 70% in the 2023-2024 school year.
- Average patient wait time
- Number of mistake events
- Average claim processing time and cost
- Training per department
Example: Increase training per department to four per month
While it will take a bit of time and a good amount of thinking, you will set your business up for success by putting SMART goals in place. With a healthy number of KPIs, you’re sure to stay on track toward your most productive year yet.