Stretch Goals...

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Taking Your Sales & Profit Plans To Another Level

Whether you are running a multi-million dollar business or a simple mom and pop shop, stretch goals are essential for optimizing your success. Stretch goals can be used to elevate performance goals beyond current expectations.

Stretch goals are defined as goals set above current expectations but are highly achievable. In a business setting these goals can be set for sales and profit as well as employee productivity. Whichever the case stretch goals are geared toward improving performance and they work.

For businesses the usage of stretch goals are very clear. You have a main goal of achieving $1,000,000 in sales this year. Your sales goal has a profit goal of 10%. So, the regular set goals expect $1,000,000 in sales with $100,000 in profit. Your accountants have chosen these goals based upon previous years sales and profitability margins and these goals are highly achievable under regular business conditions. As a business owner, you are in tune with the ability of your business and products. This feeling may lead you to employ a stretch goal. While the company can clearly hit the $1,000,000 sales goal and the 10% profit margin, you want more without setting your business management up with unreal expectations; insert stretch goals.

For this company a stretch goal of $1,200,000 may be chosen with a 15% profit margin. What this stretch goal says to your people is, "I know you can attain all of the company's goals. Let us aim a little higher!" Stretch goals in business should be set high enough to remain attainable under optimal conditions. Stretch goals, though rarely fully achieved, lead to higher sales and profit margins leaving a positive affect on the business despite the lack of total achievement. Your company may only hit $1,100,000 with a 12% profit margin, but the stretch goal helped to attain a more productive outcome than the set company goals alone.

A key factor in stretch goals is attainability. The stretch goal theory must not be abused by setting unattainable goals. If a company sales plan wants $1,000,000 in sales with a 10% profit margin setting a stretch goal of $10,000,000 is clearly out of the realm of the business. By setting unreal goals, business moral and functionality will be impaired and the idea of a stretch goal will move quickly from a positive enforcement to a joke. Bad business moral can lead to low production and the original company sales plan may never be met.

Stretch goals can be set by company employees, managers, founders, owners and even customers. Expecting more is a major stone in the foundation of the business economy. The three key points to remember when setting stretch goals are:

Make the goals attainable.

Expect more than standard or company set goals.

Praise accomplishments even if the stretch goals are not met 100%.

By employing these three factors and using stretch goals as a secondary sales and profitability plan for your business, you will effectively grow said business beyond all expectations.

By lvsummer