Goal setting is a standard practice for most businesses – but what is the most effective way to do it? Unlike most New Year’s resolutions, goal setting for your cannabis company should be a little bit more specific than “stop ordering munchies after midnight.” Why is goal setting important? Jessica Barrett, the People Ops Manager for Vangst states,
“At Vangst, everyone has full transparency in our quarterly company and departmental goals. We’ve found that goal-setting visibility not only builds individual accountability, but it creates a shared alignment towards our company vision across each department. Every team understands how their SMART goals directly impact quarterly business objectives and allow us to achieve our long-term vision.”
By taking the time to properly set up your goals, you place your employees on the path to success. To help you effectively achieve your deliverables, we’ve developed a comprehensive outline you can use to develop and keep track of your objectives. If you’re interested in learning more about workforce planning, be sure to check out our guide on setting 30/60/90 day goals for your new hire and our best practices for crafting a job listing in the cannabis industry.
Step 1: Create a SWOT analysis for your business
Before you head straight to the goal setting, identify the strengths, weaknesses, opportunities and threats (SWOT analysis) for your business. Taking the pulse on where your company currently stands can help you identify underlying opportunities. When pinpointing your company’s strengths, focus on what makes your brand unique. Most companies will claim they grow or sell a great product, but what makes yours stand out from the competition? When identifying your weaknesses, take an honest look at where your company could improve. Examine all areas of your business — the people, resources, procedures, etc. The sooner you uncover your weak spots, the faster you can work to repair them. Gathering input from employees and both new and returning customers can further help identify your strengths and weaknesses.
Opportunities are areas, both within your company and within the industry, that you can capitalize on. Think in the future for opportunities and threats. Threats are obstacles that could come from your competitors, market changes, changes in legislation or changes within your own business structure. In the cannabis industry, these changes happen rapidly. Research your state’s regulatory climate to see if any changes in cannabis law, taxes or regulation could affect your business. For the examples below, we’ll use a theoretical vertically integrated cannabis business.
Step 2: Determine your benchmark metrics
Now that you’ve completed your SWOT analysis, drill into the details of your strengths and weaknesses to determine exactly where you stand. Benchmarking your current metrics can help you further identify exactly how much growth you want to see or maintain. Not every benchmarked metric will have a number associated with it, some goals are communication or process-based. Below is a continued example from the above sample company.
Step 3: Create your SMART goals
Now that you’ve identified your SWOT and benchmarked where you currently stand, start to plan your SMART goals. SMART stands for specific, measurable, attainable, relevant and timely. By incorporating each of these elements into your goal, you remove ambiguity and clearly specify what you’re hoping to achieve.
A key component to creating your SMART goals is to identify the driving and restraining forces within your business to evaluate if the goal is actually obtainable. Driving forces are what help move the goal forward, while restraining forces work to block the progress of your goal. For example, the driving and restraining forces for the goal “increase sales at the Denver location” may look something like:
If your goal has more driving forces than restraining forces, the factors contributing to the goal will help the change move forward. If you’re faced with more restraining forces than driving, the goal may not be attainable without adjustment to the restraining factors. In addition, some driving or restraining forces may hold more weight than the others. If so, you can assign the forces a number that coincides with the weight the object holds to properly determine the direction of change the goal faces.
After weighing the factors, the driving forces are moving the goal forward 5 points, while the restraining forces are hindering the goal by 4 points. The goal is facing a total force of +1. Your SMART goal should aim to decrease the restraining forces so the goal has the path of least resistance.
Once you’ve identified the driving and restraining forces and determined the goal is attainable, outline the objective using the SMART format to create a comprehensive goal your team can follow. For example, instead of claiming you’d like to increase sales at your Denver store, use the SMART matrix to define what that means.
Specific: Set a defined metric for your team to hit. Include a relevant numerical metric where applicable.
Example: Increase sales by 10% at the Denver store.
Measurable: How will you know when you’ve reached your goal? Determine the beginning metric and goal number. You can use the benchmark data to determine the starting point. Use the end number as what you’d ultimately like to achieve.
Example: Increase sales from $200,000 to $220,000.
Attainable: Is this goal possible for your team? This is where your driving/restraining evaluation comes into play. In addition, you may need to do a bit of digging in previous months or years to uncover past performance. If you’ve increased your sales by 6-7% each quarter, increasing sales by 10% is more than you’ve done in the past, but could be obtainable with the correct processes in place. Most goals will aim to push your team to perform better year over year, you want to give your team a higher goal to work towards. Make sure to include how you plan to achieve this. Without proper action items in place, your team will be left guessing how to achieve this.
Example: We’ve increased revenue by 6-7% quarter over quarter, so increasing our sales by 10% is obtainable. We plan to increase sales by 10% by holding bi-monthly events that have helped increase sales in the past, implementing a tasting room for consumers to try before they buy and streamline our internal communication processes to avoid product shortages that caused low sales in the past.
Relevant: Make sure to evaluate each goal for company-wide relevancy. Goals take time to implement and execute, you want to make sure the goals you set are worthwhile.
Example: If a larger company goal is to increase revenue by 3% in Q1, increasing sales at the Denver store location contributes to that goal.
Timely: Placing time constraints on your goals helps employees stay on track and not lose sight of the objective.
Example: Increase sales at the Denver store by 10% from Q1 2020 to Q2 2020.
Now, with the SMART elements identified, your redefined goal changes from “increase sales at the Denver store” to “Increase sales from $200,000 in Q1 to $220,000 by the end of Q2 at the Denver store by holding bi-monthly events, implementing a tasting room and streamlining our internal communication processes to avoid product shortages.” Aim to create a full sentence that includes all elements of the SMART goal.
Keep in mind, not every goal has to be revenue-based. For the goal of streamlining the communication process, the SMART goal may look something like, “Implement mandatory weekly management meetings by the end of Q1 at the Denver store with 90% attendance. During the lunch hour, we will provide food and go over current inventory, sales and company needs.” The goal is specific, measurable, attainable, relevant and timely.
Again, taking the time to properly outline each goal takes time, but it’s vital to achieving your goals as a company.
Step 4: Share your goals with your employees and record feedback
It’s important to include your employees in the goal setting process so they are both aware of the metrics that need to be hit and so they can help identify any factors you may have missed. Set meetings to go over specific goals for each department and record valuable feedback and make sure each employee is informed of the goals in place so there is no confusion about the expectations. What are the incentives for achieving the goals? While incentives aren’t necessary, they are great motivators for your employees and an effective way to get the team onboard with the changes.
Example: In our fulfillment meeting, Kelly informed us that the vendor “Dabs for Days” typically runs out of product in July due to 710. To keep up with our goal of increasing sales by 10%, we’ll need to place a larger order in March so we don’t run out of this popular product. You can then adjust your goal as needed.
By identifying your company’s SWOT analysis, outlining your benchmarking metrics, establishing SMART goals and gathering feedback, you are well on your way to a successful year. After setting up your initial goals, make sure to continually adjust your tactics, continue to gather feedback and track your company’s performance to gauge your growth.
If you’re ready to jump into the process, download our goal setting template below to access the SWOT matrix, benchmarking metrics, SMART goals table and feedback space in one convenient document.