Setting and Prioritizing Strategic Goals
What are strategic goals
Characteristics of Strong Strategic Goals
Strong strategic goals possess several characteristics that make them effective in guiding an organization’s efforts towards achieving its objectives. These characteristics include:
- Specific: Strong strategic goals are specific, meaning they clearly define what the organization wants to achieve. They should be clear and concise, specifying the desired outcome, the target population, and the timeline for achieving the goal.
- Measurable: Strong strategic goals are measurable, meaning they can be quantified and tracked. This allows organizations to monitor progress and determine whether the goal has been achieved.
- Achievable: Strong strategic goals are achievable, meaning they are realistic and attainable given the organization’s resources and capabilities. They should be challenging, but not impossible to achieve.
- Relevant: Strong strategic goals are relevant, meaning they align with the organization’s overall mission and vision, and are consistent with its values and priorities. They should be consistent with the organization’s overall strategy and direction.
- Time-bound: Strong strategic goals are time-bound, meaning they have a specific timeframe for completion. This helps to ensure that progress is being made and that the goal will be achieved within a defined period.
- Ambitious: Strong strategic goals are ambitious, meaning they are ambitious, challenging and stretch the organization’s capabilities to achieve the desired outcome.
- Inspirational: Strong strategic goals are inspirational, meaning they inspire and motivate employees and other stakeholders to work towards achieving them.
- Complementary: Strong strategic goals are complementary, meaning they are aligned with each other and together form a cohesive whole that supports the organization’s overall mission and vision.
Overall, strong strategic goals possess specific, measurable, achievable, relevant, time-bound, ambitious, inspirational and complementary characteristics. These characteristics help organizations to clearly define what they want to achieve, monitor progress, ensure that goals are realistic and attainable, and align with the organization’s overall mission and vision.
How to Assess Goals for Prioritisation
Assessing goals for prioritization involves evaluating the organization’s goals against certain criteria to determine which are most important and should be given priority. Here are a few steps that organizations can take to assess goals for prioritization:
- Define the criteria: Establish the criteria that will be used to evaluate the goals. Criteria should align with the organization’s overall mission and vision, and may include factors such as alignment with strategic objectives, potential impact, feasibility, and resource requirements.
- Evaluate the goals: Use the established criteria to evaluate each goal. Assign a score or rank to each goal based on how well it meets the criteria. Goals that score higher on the criteria should be considered higher priority.
- Prioritize the goals: Once the goals have been evaluated and scored, prioritize them based on their scores. The goals with the highest scores should be given the highest priority.
- Review and adjust: Regularly review and adjust the priority of the goals as needed. This can be done on a regular basis, such as quarterly or annually, or as circumstances change.
- Communicate with stakeholders: Communicate the prioritized goals and the criteria used to prioritize them to all stakeholders including employees, customers, shareholders, partners and suppliers.
- Assign ownership: Assign ownership of the prioritized goals to specific individuals or teams who will be responsible for achieving them.
It’s important to note that prioritization is an ongoing process and goals should be regularly reviewed and adjusted based on the organization’s changing circumstances. Additionally, involving stakeholders and key personnel in the process of goal assessment and prioritization can ensure that the goals selected align with the organization’s overall objectives and are supported by all stakeholders.
How to Calculate Anticipated ROI
Return on Investment (ROI) is a measure of the profitability of an investment and is typically expressed as a percentage. To calculate the anticipated ROI for a particular investment, you can use the following formula:
ROI = (Net Profit / Total Investment) x 100
Net Profit is calculated by subtracting the total costs of the investment from the total revenue generated. Total Investment is the sum of all costs associated with the investment, including initial costs, ongoing costs, and any financing costs.
For example, let’s say a company is considering an investment of $100,000 in new equipment. The company anticipates that the new equipment will generate $150,000 in revenue and $50,000 in costs, for a net profit of $100,000 ($150,000 – $50,000). Using the formula above, the ROI for this investment would be:
ROI = ($100,000 / $100,000) x 100 = 100%
This means that for every $1 invested, the company will generate $1 in profit.
It’s important to note that this is an anticipated return, and the actual ROI may be different once the investment is made. It’s also important to consider other factors such as the investment’s risk, the timeline for the return and the opportunity costs.
Additionally, it’s useful to look at the ROI in terms of time, so it’s common to use the formula of ROI annually (ROIa) or ROI over the lifetime of the investment (ROIlt)
ROIa = (Net Profit / Total Investment) x 100 x (1/ years) ROIlt = (Net Profit / Total Investment) x 100 x (1/ lifetime)
In this way, it’s possible to compare investments with different timelines and evaluate which one will generate the best return over time.