Setting The Company’s Long-Term Goals

The idea of setting your long-term goals may seem like a waste of effort with so many thoughts running through your head. That being said, it is extremely difficult to achieve business success if you don’t set out your ultimately where you want to go. This is especially true in light of the fact that these goal have to take into account both your personal and professional aspirations. In this lesson we show you how to set long term goals for you and your company.

Any well-run business will have clear and defined long term goals that set the direction of the company and short term objectives that drive those long term goals. These are important to the entrepreneur as they clarify the purpose of the business and help identify necessary actions. For entrepreneurs, your long-term goals must encompass not only the goals for the business but your personal long-term goals. So when reading this lecture, keep in mind that the long-term goals for the business should take your personal goals into consideration.

What are long-term goals?

Long-term goals are designed to look three to five years into the future and while long term goals can vary, they generally fall into four categories – growth, profit, service or social mission:

• Growth.Goals related to the expansion of the company, through new employees, for instance.
• Profit. Goals set to increase profits by a certain percentage.
• Service. Goals related to improving customer service satisfaction or customer retention.
• Social. Goals that focus on giving back to the community, through philanthropy or volunteer organizations, for example.

Not all long term goals need to fit into these categories. Here are some other examples:

• Increase Personal Wealth: A common long-term goal is for the new venture to eventually increase the business owner’s personal wealth. Increasing an entrepreneur’s personal wealth may mean different things to different people. While the common definition would be an increase in financial resources, other definitions may include a flexible work schedule, creating a company to meet social needs in society or improving the lives of individuals working in the business venture. These long-term goals help entrepreneurs stay on track when starting a business and creating plans for increasing the entrepreneur’s wealth.
• Expand into New Opportunities: Entrepreneurs may start a business with the plan to grow and expand the business into new opportunities or business industries. This long-term goal allows entrepreneurs to focus on making their business the biggest and best in its industry. Entrepreneurs setting these types of goals often have a bigger plan in mind when starting a business. These plans may require the help of other individuals or economic resources to grow the business. Entrepreneurs may also look to expand the business quickly using whatever means possible.
• Go Public: Taking a business public may be a long-term goal of entrepreneurs. This long-term goal may take several years to complete. Small businesses must usually have a strong history of financial performance in specific business operations and ensure future investors about the company’s long-term viability in the business environment. Entrepreneurs may also need to recruit other individuals to work in the business who have extensive experience or expertise in the business industry.
• Lasting Legacy: Entrepreneurs may choose to start a business to create a lasting legacy for their family. Starting a business may allow individuals to recruit family members into the company and employ them for running the business. Many of today’s largest companies started as simple family businesses.

Imagine that the date is five years from now. Where do you want to be? Will you be running a business that hasn’t increased significantly in size? Will you command a rapidly growing empire? Will you have already cashed out and be relaxing on a beach somewhere, enjoying your hard-won gains? Answering these questions is an important part of building a successful plan. In fact, without knowing where you’re going, it’s not really possible to plan at all.

chapter Quiz

Q1. All of the following are categories of long term business goals except:

a) Growth b)Profit c)Weekly d)Social

Q2. Increasing personal wealth can be a long term goal associated with the company.

a) True b)False

Q3. Any well-run business will have clear and defined long term goals that set the direction of the company and short term objectives that drive those long term goals.

a) True b)False