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Planning and Goal Setting

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U.S. Small Business Administration

MP-6

PLANNING AND GOAL SETTING FOR SMALL BUSINESS
Management and Planning Series ____________________________________________________________

__________________ While we consider the contents of this publication to be of general merit, its sponsorship by the U.S. Small Business Administration does not necessarily constitute an endorsement of the views and opinions of the authors or the products and services of the companies with which they are affiliated. All of SBA 's programs and services are extended to the public on a nondiscriminatory basis. ____________________________________________________________

__________________ TABLE OF CONTENTS INTRODUCTION 1 MANAGEMENT BY OBJECTIVES 1 …show more content…

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Defining Your Business The first step in developing an effective MBO program is to define your business. Ask yourself the following questions: ! ! ! What business am I in? Is my definition right for today 's market? Do I need to change my business to meet emerging customer needs?

A clear vision of your business is crucial for planning your marketing, product development, buildings and equipment, and financial and staff needs. For example, a drop in sales caused a small business manufacturer of metal trash cans to reexamine its product. To regain lost sales, the owner decided to redefine the product as metal containers and to develop a new marketing plan.

Setting Goals

Long-range business goals will be the cornerstone of your company 's MBO program. To achieve these goals, you must have a method to communicate them to your managers and employees. One way is to bring managers and employees into the process by asking them to help formulate the company 's short- and long-range goals. If they have a role in establishing the goals, they will be more committed to achieving them. All goals should relate to and support the long-range objectives for the company. In this way, you can ensure that the goals of all levels of management are consistent. If goals are incompatible, you may find that employees feel like the middle manager of a research and development company who exclaimed in a seminar, How can I set my goals when I don

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