Running a successful business requires resilience, patience and strategy. Many entrepreneurs struggle with the latter, especially with effective goal setting.
As an entrepreneur or business owner, you’ve probably set goals that you hope to achieve. Chances are you’ve defined it short term goals that you expect to arrive soon. Like a startup, you may have set goals that will help you during this stage of your business life.
I’m sure you’ve given a lot of thought to the goals you want to achieve. But have you ever thought about separating your goals by goal type? Specifically, which are quantitative and which are qualitative? If you know the difference, you may be able to get to both types faster.
In this article, you will learn more about the two main ones types of business goals you can (and should) set up for your business.
Effective goal setting
It’s not enough to start a business with a vague idea of what’s on the horizon. Even the most meticulous planners among small businesses often fail simply because of ineffective goal setting and lack of follow-through.
Not only is it critical to set clear and reasonable goals for your business, but it’s also imperative that you manage progress during the process of achieving those goals. This means going the extra mile to track your employees’ achievements on company projects. People are 42% more likely to achieve goals when your progress is physically recorded. As a business owner, you cannot afford not to take advantage of this opportunity.
The act of setting a goal can seem intimidating at first. To make things easier for yourself, start by separating your company’s main goals into two different categories: quantitative and qualitative. Breaking these goals down into “bite-sized” pieces will simplify the process for both you and your employees.
Using the SMART method
A tried and true goal setting technique is the SMART method, which simplifies goal setting and makes it more manageable. SMART in this case is an acronym, used to guide individuals in setting goals so that it is easier to achieve. Here’s a breakdown of the SMART acronym:
S (specific)–when setting a goal, be as specific as possible. For example, instead of setting a goal to “increase sales,” look a little deeper. What more increase do you want? Where will the sales come from? Who will be responsible for the increase? Questions like these can help narrow down each goal, making them easier to target and track.
M (measurable)–Quantifying your goal, or putting it in numbers, dramatically improves progress. To make your goal measurable, you need to implement milestones as part of an overall progress plan.
A (Achievable)–Setting an extremely ambitious and borderline impossible goal may sound exciting, but you could very well be planning to fail. For your health and the health of your employees, make a point to set goals that are reasonable.
R (relevant)–A goal will only get the attention and focus it deserves if it is relevant. This means that any goals you set for your business must be important and related to the industry or related to success in some way. Setting goals that are not important to the core of your business can hinder progress and distract employees from more important things.
T (limited in time)–Most importantly, your goals should be constrained by a time limit. This can feel like extra pressure. But in reality, a little pressure is just what you need to maintain a healthy pace of progress.
Quantitative vs. qualitative: what’s the difference?
Quantitative goals are goals that are rooted in direct action. These goals are objective and easily calculated using analytics about your business. Quantitative objectives center around tangible and measurable units. For example, revenue, link clicks, leads and sales. These goals are usually represented by numbers or raw data.
For example, a goal for your company might be to increase the number of sales processed monthly. If you initially want to see a 20% increase in sales by the end of next month, this is considered a quantitative goal. If it helps, remember that the term “quantitative” comes from “quantity,” referring to a hard number.
When discussing business goals, you will find that most people prefer quantitative goals. This is because they offer a specific “good” or “bad” response to business matters. These are goals that can be achieved simply by working hard and crunching the numbers; it is relatively simple.
Qualitative objectives, on the other hand, refer to the more abstract part of the business. This is where things get a little more complicated. Qualitative objectives they refer to goals that are subjective and based on results rather than action. These goals are complex because they cannot be measured, but instead provide information about other areas of the business.
For example, if one of your business goals is to improve company culture, this would be considered a qualitative goal, because it is subjective and cannot be strictly measured. However, that doesn’t mean it isn’t important. To set a qualitative goal, you’ll need to add mitigating criteria that indicate success.
Extending the example of improving company culture, your qualitative goals should be those that reflect positive changes in workplace engagement. Using resources such as feedback sessions, associate retention, and attendance rates, you can surmise whether your company culture is moving in the right direction.
By far the most difficult aspect of setting qualitative goals is deciding what conditions indicate success. Because of the abstract nature of these goals, they are often overlooked in favor of their “hard facts” counterparts. However, qualitative goals are just as important to setting your business up for success. Taking the easy way out by ignoring these opportunities for growth can cost you big time.
How they work together
A successful and strategic entrepreneur will add both of these types of goals to their professional arsenal. Quantitative objectives, while specific and reliable, lack the same depth and complexity as qualitative objectives, which provide their own unique insights, albeit with a little extra work.
Neglecting one in favor of the other will leave your business unprepared and directionless. They work best when used together to form multidimensional targets. It’s important to take advantage of the best of both worlds to see your business succeed.
Business Goals vs. Objectives: Understanding the Difference and Why It Matters
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Quantitative and qualitative goals are the cornerstone of a successful business venture, and at Ikaroa, we understand just how vital it is that these two types of objectives work together in harmony. Quantitative goals focus on achieving numerical results, such as increasing sales or decreasing operating costs, while qualitative goals require a more subjective approach and focus on achieving intangible results such as customer satisfaction or achieving brand recognition.
When applied together, quantitative and qualitative goals are more powerful and successful than when used on their own. Quantitative goals form the basis of creating a business plan and measuring progress towards, whether that progress is toward profitability or other goals. Qualitative goals provide the essential context needed for an effective strategy, though they are about more than just data. Quantitative goals are measurable and achievable, while qualitative goals are aimed at gaining insights and driving desired outcomes.
At Ikaroa, we understand the importance of a holistic approach when it comes to goals. We believe that while quantitative goals can provide clear indicators of where a company should focus on, qualitative goals fill in the details and provide the insight to develop effective strategies. Our team of experts works hard to identify the most important goals and objectives of a company and develops strategies to drive meaningful outcome.
We also recognize that in order to be successful, companies need to set measures to track their progress. That’s why we leverage both quantitative and qualitative metrics to measure and monitor progress in key areas. This ultimately helps Ikaroa to provide our clients with the most effective solutions.
Overall, quantitative and qualitative goals are vital for the success of any business venture. At Ikaroa, we strive to use a mix of both quantitative and qualitative goals to ensure measurable and intangible results. Our team of experts are here to help you develop strategies that engage stakeholders, maximize profits and produce desired outcomes.