Read time: 3.5 minutes
Regardless of what your business does, what solutions is creates or the industry it serves, you and all other CEOs share a common business goal: to grow a profitable company.
Without money, your business cannot keep creating solutions to serve your clients, and your team cannot garner compensation for the value they provide to the business and to the clients.
The revenue performance goal takes into account every square inch of your business. It brings together every department. It is a unifying tool with which to measure your organization’s entire efforts against.
How can you craft such an all-encompassing goal?
Read below to learn the basics of setting a revenue performance goal your entire organization can rallying around and support.
STEP 1: Consider Your Team and Its Capabilities
Think about the employees your organization has in place right now. What value are they capable of creating? Are you willing to grow your organization to increase its capabilities if needed? Can your company handle this?
You want to set a goal that hits the sweet spot of your team’s capabilities. Shoot for a revenue performance goal that is too high, and you set everyone up to struggle for the impossible. Throw-out a revenue performance goal that is too low, and your team will start working below their abilities. Engage with the marketplace and with team to set the target so it accounts for market dynamics while also becoming your team’s objective – not just the one you set for them.
STEP 2: Consider Your Client
Be wise about what you can do to maintain your brand and client satisfaction. Your business exists to serve other businesses – that has to be fundamental to your purpose. Don’t think about quantity of revenue — think about quality.
STEP 3: Keep Your Entire Organization In Sync
The CEO and COO will lead the revenue performance goal, but that does not mean you should not bring in other counsel. Talk to other leaders. Keep your entire organization attuned to updates and the process. If you get everyone’s buy-in early, everyone will more-readily and full-heartedly strive toward the revenue performance goal set.
STEP 4: Think of Revenue Performance as a Business Model
When you hear “revenue performance goal,” is your first thought, How fast can we grow? I beg you to remember, not all revenue is good revenue. Look at all your investments and move forward with wisdom. Revenue performance does not just mean growing revenues but rather growing the value of the company by creating more value for your clients— and its sustainability. For some organizations, revenue performance is growth, while improving the profitability of the revenue is a better gauge for others.
STEP 5: Find the Optimal Top-line Revenue Number and Compound Growth Rate
Think about the total costs in investments required to meet your revenue performance goal. Remember staffing, campaigns, solution development, operating investments, etc. and their associated costs. And then think about how long it will take to reach that revenue performance goal. Say you want your company to reach $100 million in three to five years. What will it take to get there?
STEP 6: Share It
In order for your entire organization to be on-board with your revenue performance goal, you will have to collaborate along the entire process. You need everyone’s buy-in for this to spread its roots throughout your organization and burgeon into sustainable, focused efforts.
It is not too late in the year to set your organization on the right track to sustainable revenue performance.