Sales goals and objectives are critical because they instil a culture of accountability and achievement across the team, which drives productivity. This feeds directly into revenue growth; and we all want that.
Sales goals and underlying objectives are used by management to help outline how these goals align directly with the overall company initiatives. If positioned correctly, the sales team will be able to see a direct link between the activity they do and its effect on the bottom line.
The SMART Approach to Goal Setting
The structuring of these goals should take the SMART approach. It is a tested system standing for Specific, Measurable, Achievable, Realistic, and Time-Bound. Let’s expand on how each of these can be applied:
- Specific: Goals should be clear and precise, leaving no ambiguity. For example, instead of aiming to ‘increase sales,’ a specific goal would be ‘increase sales by 10% in the next quarter.’ This clarity helps everyone understand exactly what is expected.
- Measurable: Every goal should include criteria to measure progress. For instance, ‘increase the number of discovery calls from 2 to 4 per week’ allows the sales team to track progress quantitatively. Having measurable criteria makes it easier to stay motivated and adjust strategies if necessary.
- Achievable: Goals must be realistic, considering the available resources and constraints. An achievable goal might be ‘upsell to 50% of existing customers within 6 months,’ which is challenging yet within reach given the right efforts. This ensures that the team remains motivated rather than discouraged.
- Realistic: Goals should align with the current business environment and capabilities. A realistic goal takes into account market conditions, team capacity, and other relevant factors. For example, aiming for ‘a 5% increase in lead generation across all social channels’ is realistic if the marketing efforts and channels support it.
- Time-Bound: Setting a timeframe creates urgency and focus. A time-bound goal such as ‘reduce the sales cycle by 7 days in the next quarter’ provides a clear deadline, encouraging the team to prioritise and manage their time effectively. Without deadlines, goals can drift without progress. Using this framework, a business (and an individual) can start to structure their day with these goals in mind.
Structuring Goals Using the G.O.A. Framework
Start with a goal; this can be broken down into objectives to hit that goal. Taking it one step further, you would outline the daily, tactical activities that will hit these objectives which in turn will achieve these goals. A framework we use at Sales for Startups is called the G.O.A. framework:
- Goal: The overarching outcome you want to achieve. It represents the big picture, such as increasing annual revenue or expanding market share. A goal provides direction and purpose for the sales team.
- Objective: Objectives are the specific, measurable steps required to achieve the goal. They break down the larger goal into actionable targets. For example, if the goal is to increase annual revenue, an objective could be ‘acquire 20 new clients in the next quarter.’ Objectives provide a roadmap for reaching the larger goal.
- Activity: Activities are the daily tasks and actions that help achieve the objectives. They are the actionable items that team members work on consistently, such as making a certain number of sales calls per day or attending networking events. Activities ensure that objectives are being worked on actively and are the building blocks for achieving goals.
By structuring sales efforts around Goals, Objectives, and Activities, teams can ensure that every action taken is directly contributing to a meaningful outcome. This alignment helps maintain focus, improves productivity, and fosters a sense of progress and achievement.
Grouping Goals into Categories
To build upon this idea, you can group goals into three different categories:
- Activity Goals
- Annual Goals
- Team Goals
Activity Goals
Activity Goals: These are the day-to-day tasks that salespeople need to complete to keep the momentum going. Examples include making a set number of cold calls, sending follow-up emails, or attending networking events. Activity Goals are crucial for maintaining consistency and building a pipeline that supports larger sales targets. They directly influence success by ensuring the foundational activities are in place.
Annual Goals
Annual Goals: These represent the larger targets that a company or team wants to achieve over the course of a year. Annual Goals are often tied to the company’s broader strategy, such as increasing total revenue by 20%, launching a new product line, or expanding into a new market. Breaking down Annual Goals into quarterly or monthly targets helps teams stay on track and ensures continuous progress throughout the year. To achieve Annual Goals, it is essential to develop strategies, allocate resources, and understand the timeline and external factors that may influence success.
Team Goals
Team Goals: Team Goals focus on collaboration and collective achievements. These goals are often broader and require every member to contribute for success. Examples include improving overall customer satisfaction, reducing the churn rate, or hitting a specific team-wide sales target. Team Goals foster a sense of shared responsibility and motivate the group to work cohesively. These types of goals emphasise that the biggest and best outcomes can only be achieved if the whole team works together in alignment with the same objectives and timescales.
Start with the Annual Goals; break them down into quarters and ask yourself what strategies will help meet these objectives. What resources will you need? What outside influences should you be aware of that may be able to help? By aligning Activity Goals, Annual Goals, and Team Goals, you ensure that the sales team works cohesively towards the company’s overarching success.
Revising Sales Goals for Specificity and Achievability
Sales goals differ from company to company and from person to person. The goals outlined below are good, but their revision makes them more specific and therefore more achievable:
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Reduce Sales Cycle
- Do: Set a specific timeline, such as ‘Reduce sales cycle by 7 days in the next quarter.’
- Don’t: Set a vague goal like ‘Reduce sales cycle’ without defining a clear metric or timeframe.
Reducing the sales cycle can have a significant impact on revenue growth by improving efficiency. Setting a clear target ensures that everyone on the sales team is aligned and understands the urgency of the improvement. Without a specific timeline, it is difficult to measure progress or determine when corrective action might be needed.
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Increase Conversations
- Do: Specify a measurable target, like ‘Increase the number of discovery calls per week from 2 to 4.’
- Don’t: Use ambiguous language like ‘Increase conversations’ without setting a concrete number.
Increasing the number of conversations is a key step in building a robust pipeline. By defining a concrete number, sales reps have a clear goal to work towards each week, which can help in tracking and optimising the sales process.
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Increase Leads
- Do: Define a percentage increase and a timeframe, such as ‘Increase lead acquisitions by 5% across all social channels for next quarter.’
- Don’t: Set a generic goal like ‘Increase leads’ without indicating how much or by when.
A clear, measurable lead generation goal helps the marketing and sales teams to focus their efforts and resources effectively. When everyone knows the target increase and timeframe, they can better coordinate campaigns and outreach activities.
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Upsell to Current Customers
- Do: Set a specific target, such as ‘In the next 6 months, upsell to at least 50% of current customers.’
- Don’t: Use non-specific phrasing like ‘Upsell to current customers’ without a clear percentage or timeframe.
Upselling to current customers is one of the most efficient ways to increase revenue. Setting a concrete target allows the sales team to identify opportunities for growth within the existing customer base and develop specific strategies to achieve these upsells.
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Make More Revenue
- Do: Be specific about the increase, for example, ‘Bring in 5% more revenue each month considering both increasing the average customer value (ACV) or obtaining more customers.’
- Don’t: Set a goal like ‘Make more revenue’ without defining the percentage increase or the strategy to achieve it.
A specific revenue target helps the team focus on the methods for achieving it, whether that involves acquiring new customers or increasing the value of current customers. Clarity on the goal ensures that all team efforts are directed toward achieving a defined outcome.
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