Make Goal-setting a 2017 Resolution and Watch Your Practice Grow

Goal-setting is an important exercise in defining the direction and outcomes of your business practice. Professionals and companies who set and document defined goals are more successful, productive and fulfilled than their peers who do not.  Inc. magazine’s goal-setting infographic contains a long list of statistics supporting the value and need for setting goals.

Despite the commonly discussed importance of setting goals, most financial advisors aren't.  The Study on Drivers of Business Growth conducted by the Financial Planning Association (FPA) Research and Practice Institute in 2014 reported that while surveyed financial advisors have a sense of their business direction, few have defined a clear roadmap.

Seventy percent of respondents did not set formal goals, and of that majority, few were motivated to do so. At the same time, the study indicated that “high growth advisors were considerably more likely to have a formal written business plan” that defined business goals. In which group do you fall? Do you run your business on instinct or set goals and then unintentionally lose sight of them as you get busy or problems arise?

Here are some important tactics – some from well-known and successful entrepreneurs – in creating realistic goals and remaining on target to grow your practice.

1. Stick to Warren Buffett’s Top Five Goals 

2. Create SMART Goals 

SMART is a popular concept attributable to renowned management consultant Peter Drucker’s "Management by Objectives" in creating attainable goals. Each letter in the SMART acronym represents an action item:

• Specific – outline specific outcomes rather than general aspirations. 
• Measurable – can you quantify results?
• Achievable – do you have the resources, time and money to achieve goals?
• Relevant – to your practice and the current market.
• Time bound – define the timeframe.

Using the SMART approach, you can formulate more relevant goals for your practice. Mindtools.com provides detailed steps on using the SMART formula in their article on "SMART GOALS, How to Make Your Goals Achievable.”

3. Set Challenging But Realistic Goals  

Research conducted by Edwin Locke and Gary Latham found that challenging goals led to higher performance than easier or no goals. In the 1990s, then General Electric (GE) CEO Jack Welch employed the concept of "stretch goal" initiatives to specify performance levels significantly higher than the previous year. Through these “stretch goals,” employees had to think outside the box to find a way to reach them. But while challenging goals provide greater motivation and opportunities to push you to a higher plateau of performance, they must be realistic. For example, while you might like to grow the business by 20 percent, is that possible within one year? Evaluate your skills, time and resources to determine if you can meet that goal. If one of your goals is to deepen your knowledge base or confidence about an opportunistic competency like retirement income planning or optimizing life insurance in a client’s portfolio, make sure you understand the requirements of pursuing education like an advanced financial designation. Set yourself up for success by balancing a motivating challenge with the reality of your circumstances.

4. Monitor Goals

A year is a long time to follow a goal. Over time, people have a tendency to go back to their regular habits and quickly forget goals. According to the 2014 FPA Study on Drivers of Business, surveyed advisors who did review business goals did so less than every six months. Establishing periodic milestones tracks success and maintains momentum. According to the FPA Study, periodic goal reviews also provide time to take correction action to short term goals. If you missed a milestone, determine the reason. What roadblocks are stopping you from achieving an event? Take the opportunity to realign activities to get the job done. Perhaps, you need to update or amend goals based on new priorities as well as changes in the market and your practice. If you reach a milestone, celebrate as you and your team are making progress.

5. Tell Your Staff

Communicate your goals with associates. According to a Workboard Infographic published by Inc., companies who fail to achieve goals 70 percent of the time do not engage their people. On the other side, companies with engaged team members make 28 percent higher annual operating margin. Even a small practice must communicate goals, so associates better understand expectations and their role in specific activities. If you change course during the year, maintain communications to ensure everyone remains on board and in the know. Greater transparency leads to active collaboration in meeting your goals.

6. Be Flexible

Sometimes you won’t reach your goal, but that’s okay. When a goal isn’t reached by the time you intended, evaluate the efforts you’ve taken to achieve it. Did you follow your intended plan of action or did you get distracted? If you gave the process your best shot but didn’t end up where you’d hoped, ask yourself if the goal is still truly a priority or if something more pressing has replaced it.  If it’s still a priority for you, try a new course of action.  Don’t abandon the goal just because you missed the mark.  A rigid goal-setting philosophy may seem like a good way to stay focused, but harmful feelings of self-deprecation may result if you don’t allow flexibility in your approach. An article from the Harvard Business Review highlights research from Columbia Business School professor Rita McGrath advising the importance of flexibility in goal-setting. If at first you don’t succeed, ask yourself if it makes sense to try, try, again.  And if it does, move forward unapologetically and enthusiastically.

In addition to setting goals, start the year by assessing your client building skills to ensure you are taking the right approaches to developing and nurturing confidence and rapport with your current and prospective clients. Discover client building tactics and tips that can quickly impact your success by downloading the Client Building Assessment and Worksheet.