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Goals are part of the meticulously built business plan. Market research, interviews with potential suppliers, possible alliances during certain phases of growth, and the identification of specific deadlines for reaching the goals are required in the business plan proposal. All the goals are selected based on the current knowledge – and the optimism – of the entrepreneur. An entrepreneur’s charisma and salesmanship can heavily influence (or warp) the goals that are supported by solid research. This means that the first few drafts of the goals and the plan will often include a number of guesses.

A clear vision of the ultimate goal of the organization is crucial to setting all of the other goals. As in software development, it is important to understand the full scope of the problem space before undertaking the effort. You don’t start coding unless you know the issue you’re trying to resolve. It helps to visually model the elements of the problem domain, identifying the connections and all of the actors of the system. From that point, it is much easier to identify the measurable work.

Whatever the product or service, measures of the daily, weekly, monthly and quarterly measurable work is required to ensure that progress is being made. (Often, there is major confusion as to what should be measured, not to mention downright mystification as to the level of measurement required.)

There are four basic performance measurements that are applicable to every organization:

1.        Safety – if neither your employees nor customers feel safe around your product or service, you will fail to stay in business.

2.        Quality – if the customer doesn’t believe that the goods or services you are selling will do what they want, you are doomed.

3.        Cycle Time – if they can’t get it when they need it, the results are self-explanatory

4.        Costs/Profits – this is the LAST of your worries, and is directly tied to how well you are performing on the other three. Profitability allows you to stay in business but it is not the reason to be in business.

Proper setting of goals is crucial to the usefulness of the business plan. Understanding that measures are there to help you and your employees, but they are not the reason you exist will help you through the next issue. Changing the plans and the goals is necessary when the world won’t cooperate and bend to your will.

To paraphrase Carl von Clausewitz: No business plan survives first contact with the customers and competitors. As the real world begins to act and interact with the emerging start-up organization, goals will require modification. These modifications can take the form of changes to quantities, size of revenue streams, deadlines moved forward or back, numbers of employees hired, areas of expertise required, and/or others. It is how these changes are handled that directly impacts the future success of the new organization.

Changes need to be:

• well researched (based on facts)
• communicated to everyone involved
• reviewed and agreed to by the participants
• properly adjusted throughout all the connected goals
• monitored for relevance (set-up good feedback loops)

Flexibility in levels of achievement and dates of completion is acceptable, as long as all of the ramifications are understood and managed.

Since modifying the organization’s goals will occur, how do you make the correct changes? How can you confirm they are correct before “losing your shirt?” This is all described by Deming’s Plan, Do, Check, Act (PDCA), and is based on the proper application of theory. It is the combination of a plan and a theory that allows the construction and selection of effective measures.