goalsetting helps your business

I recently heard a small business owner discussing the way he plans for future growth, and I was intrigued to find out he starts from a date one year in the future and works backward. What are the benefits of this “backward goal setting” and what are some tips those interested in employing that approach can take to do it successfully?

The way backward goal-setting (also called backward planning or backward design) works is pretty simple.

“The idea is to start with your ultimate objective, your end goal, and then work backward from there to develop your plan,” an article about goal setting from MindTools explains. “By starting at the end and looking back, you can mentally prepare yourself for success, map out the specific milestones you need to reach, and identify where in your plan you have to be particularly energetic or creative to achieve the desired results.”

Dave Nilsson, founder and director of digital marketing firm The Converted Click, compares it to navigating a mountain — from the top down. “It’s like taking a helicopter ride to the peak of the mountain you always wanted to explore,” Nilsson says. “Imagine you’re perched at the top with a pair of binoculars. Now, you can actually see the route to the mountain peak: Here is that huge rock that comes just before the peak…There’s that dangerous cliff mid-way…There’s the starting point… it allows you to map your milestones and give you a crisp idea of the strategy you need to follow.”

Advantages, according to those who have used this method:

  • It provides clarity and helps avoid burnout. According to entrepreneur Miles Beckler, backward goal setting gives you a clear picture of where you want to be in the future. “You won’t feel overwhelmed by your volume of responsibilities because everything is laid out step by step,” Beckler says. “This makes up the framework to reach your goal ahead of time rather than burning out before you begin.”
  • It creates a sense of urgency. “It’s very common to have the tendency to push back our biggest goals, because we don’t want to take that first step, or we don’t realize how much time and work it will take,” says David McHugh of My Mixify. “When we plan backwards, however, that urgency can help take the first step.”
  • It lets you see alternatives. “Backward goal setting gives you a much fuller appreciation of what it may take to achieve success,” says Cody Crawford, co-founder of Low Offset. That means you’ll explore many ways to reach your goal and realize it is possible to achieve — even if it seems intimidating “After all, the more alternatives you have, the better your final plan will likely be,” he adds.
  • It makes plans more specific. John Brady, founder and chief executive of Protem Partners, says backward planning reduces the chance that your goals will be vague. “The chain of thought required to map a path that leads to your goal tends to force some level of specificity. You’re less likely to misjudge what it takes to achieve your goal,” Brady explains. “When forward planning, middle steps tend to be less clearly defined and where individuals or teams or more likely to get off track.”
  • It boosts motivation. “It’s easier to stay motivated because you’ve mapped the entire process and you can always see where you are in relation to your objective,” Brady says. “That sense of forward progress is its own reward system.”

If you’re interested in using backward goal setting, here are a few tips to help you get started:

  • Define your goal. That advice comes from Avinash Chandra, founder and CEO of BrandLoom, who also says to ask yourself why that goal is important.
  • Consider the customer. “Start with the customers’ concerns in mind — their needs and what interests them — and work backward,” advises Dr. Michael Provitera, an executive leadership trainer and editor of the Business Expert Press Organizational Development collection.
  • Solicit input. Brady Cargle, chief marketing officer of PeerBoard, says it is important to ask those around you — your boss and employees alike — if they agree the resulting plan will lead to the desired growth. “This question helps align yours and your boss’s interests. No one will have any unrealistic expectations of anyone else,” says Cargle. “And if you’re a boss, this keeps your employees accountable. Chandra agrees. “Seek support and ask a third person to give their feedback,” he echoes. “You might have overlooked a point that the other person noticed.”
  • Identify resources. “Make a list of resources you will need to accomplish your goal,” Chandra says.
  • Develop deadlines and to-do lists. Chandra says to try to complete tasks before deadlines arrive, while Provitera focuses on making a to-do list “that is daily, weekly and monthly, and goes out one year on a huge chart.”
  • Set a budget. This will ensure you’ll be able to stretch funds to cover advertising, product development, and customer communication costs throughout the year, Provitera notes.
  • Get regular check-ups. “I like a weekly check on my action items, how I’m doing, and whether we’re seeing results,” Cargle reports. “This allows for a fast change up if things aren’t working or if some metrics aren’t really leading to growth.

Backward planning can always be a benefit — but probably never more so than in today’s turbulent business climate, notes Sebastian Schaeffer, co-owner and founder of dofollow.io. In fact, Schaeffer started using that approach as the pandemic forced the company “to come to terms with some market realities and adjust our forecasting.

“Working backwards can be helpful for businesses that have had to adjust their expectations and timelines for future growth due to market factors,” Schaeffer reports.

“If you have experienced a predictable and constantly increasing level of growth year-over-year, only to run into roadblocks, you likely have some medium-to-long-term goals you believed were feasible on your previous trajectory that have turned out to be more distant,” he says.

He continues, “Working backwards requires setting SMART [Specific, Measurable, Attainable, Relevant and Time-Based] goals and being realistic about potential hiccups and setbacks. I think that is more important now more than ever. The global economy shrank by 4.3% in 2020, which is the largest contraction since the Great Depression, and growth goals should be attainable and realistic to avoid being demoralized by the uncertainty right now.”