Starting a business is all about setting goals. Without a clear vision and a plan for reaching that vision, it’s easy to lose your way to the tune of lost opportunities, customers and profits. Enter KPIs, or key performance indicators, which act as benchmarks on your road to success.
Stacy Tasman, founder of How He Asked, a popular blog for marriage proposal stories, started her business without firm goals in mind. But when she started to see success, she had to scramble to define what she needed to achieve. Her number one tip? Focus, focus, focus.
“Keep your goals concentrated and don’t get lost in the big picture of supposed success,” she says.
Once you know what you’re aiming for, think about the difference between a goal, a KPI, and a target.
“It’s all the same conversation, but the words are not exactly interchangeable. Goals talk about the big picture. Targets are usually data-driven desired results. KPIs are the data points themselves,” Tasman says.
A great place to start work on your goals is to section them off by quarter. What areas do you want to improve next quarter? Is it customer retention, class utilization or increased retail sales? Or is it ways to improve your environment through studio renovations, new equipment, extra machines, or updated showers and bathrooms. Once you have honed in on a couple of areas set your KPIs in terms of specific target points. For example, increasing class utilization from 70% to 85%.
Tasman likes to focus on three things each quarter and make them known to all employees.
“I have a quarterly kick-off meeting,” she says, which includes her full-time employees and freelancers. “Before they do anything within that quarter, they should ask themselves: Does this activity align with one of our three priorities? This helps keep everyone on their toes and improves efficiency overall.”
Set realistic goals in order to stay on top of everything. You can focus on clients one quarter, retail the next—or maybe mix the two. It’s easy for ambitious people to spread themselves too thin, which is why Tasman advises to “Focus on 3 things, master them, and then move on to the next.” You will see results faster—even if that means recognizing something’s not working.
Keep in mind that the goals and targets you set don’t just matter to the people you’re working with; they also matter to your competitors and your investors. Take class cancellations, for example. If you decide to implement new strategies to minimize last-minute cancellations, keep those ideas in-house or isolated to a specific group of people.
“Don’t share your goals and every step you’re planning to take to get there with a competitor,” Tasman says. “In the case of investors, they want and need to know your growth plan to make a sound investment. Find a middle ground with your numbers. Tell them you’ve grown 40% year-over-year in group fitness classes, but don’t tell them that the way you advertised against competition brought in $20k in revenue.”
Lastly, try to get and keep your team involved. One of the best goal-setting processes is to get your employees to help you define what these goals mean. They’ll work harder if they feel they have a say, and even more so if they actually do. “Define the goals with your team instead of pushing them on people. The pushing is just going to get push back,” she says.
“There’s always that balance between decisions needing to be made quickly and the knowledge that if you include people in a collaborative way, they’ll probably be more successful.”