If you have sales people, you need to know the 87% rule.

I’m not even sure why or how it works.  But it does.  Every time.

Add up all the goals your sales people have for any given period of time.  As a group, they’ll come in at a total of 87% of what ever their goals total up to.  Try it this month – get each person to commit to a goal.  Add em up.  And you can bet they’ll come in at 87% of that number.

So, if you want to hit a number – divide your goal by .87 – and make sure your sales peoples goals add up to more than that calculation you’ve come up with.  If you want to hit $1,000,000 you need to make sure there goals add up to at least $1,149,425.  If their goals add up to less – you’re going to miss your target EVERY time.

Try it…

A great way to come up with a laundry list of potential projects for the year or quarter is through an exercise I learned at GE called ‘Workout.’  And while this list can be exhaustive, your resources probably aren’t. As a result, this list serves as a starting point from which you’ll determine critical projects, what order they should be in, and move forward with them in order to make the Painted Picture a reality.

Have your leadership team come up with a list of all the projects you could complete as a company in the upcoming year.  I love using the Post-It note exercise again for this. It draws out a long list of all the potential things you could do and it gives everyone a chance to be heard. Categorize all the projects that you touch on by business area (sales, marketing and so on).
Once you have all the projects categorized, it’s time to vote.  Count the number of projects in each area and divide by the number of people on your team.  Give each person a rounded number of projects for which they’ll be held responsible.

For example, if there are twenty-two projects listed in marketing, and six people on the leadership team, then there are four votes each.
Then, have each person come up and vote on which projects they think are highest impact and most urgent in terms of the annual goals you’ve outlined.  If they get four votes each, they can distribute them however they wish: four projects, one vote each, two projects, two votes each, one project with four votes and so on.

Once that’s done, tally up the votes on each project and rank them for each category.  Throw out any projects that don’t get any votes.  In fact, I usually try to limit the projects being committed to two to three maximum, per area, and fifteen to twenty maximum for a company for one year.

Remember: Focus on the ‘critical few’ versus the ‘important many’.

► Map Them

Once the most critical projects are identified, place them into a simple spreadsheet with these columns for each project:

· Project name

· Project number

· Goal supported

· Number of votes (helps get rid of a few more when you see how overwhelming it looks to get a few done in one year)

· Quarter start date

· Month project ends

· Cost/savings (NOT including current staff salaries)

· Days until completion

· Business areas (one column for each; e.g. IT, finance, sales, and so forth)

Show all the areas that will have to be built or implemented

Once this task is completed, everyone on the team should have an overall view, which will allow him or her to remove a few more projects that looked important, but now in the overall scheme, can wait a year.

When you finally put your goals in writing, a step-by-step action plan should be in place for each goal.

Ask yourself, “What precisely has to happen? In what order? By whom? When?” It’s the only way to ensure the goal gets hit.

I compare this to planning a dinner party.  Think about all of the little things that have to happen when you host the dinner party: inviting guests, determining the seating arrangement, figuring out in advance if anyone has allergies, planning the menu, chopping the ingredients, setting the table, serving wine, plating the food.  If you’ve ever hosted a dinner party, you know that not all of these tasks can happen simultaneously, and it takes planning in order to figure out which are the high priority tasks that need to get done first so others can be completed later.

When you’re ensuring that a step-by-step action plan is in place for every project before it gets started, ensure that you include each of the critical components that need to get done to hit the goal. Put all of the action steps in chronological sequence so that you can see the logical “work back” plan.  This is what I call “reverse engineering”—starting with a vision in mind, and then working backwards to make the vision a reality.

Ensure that each step you outline has the following questions attached to it:

· Who is doing it?

· When will it be done?

· What is the cost?

· What other business areas are involved (and do they know you need them?)

· Will a check-in with a supervisor or subordinate be needed?

Where you are with your business and where you want to be are two entirely different things for most organizations.

Most CEOs I mentor at one stage had companies that were struggling to grow.

So don’t be put off by the process of identifying strengths and weaknesses. It’s not easy.

One of the best tools for getting started with crafting your Painted Picture is to begin with an inventory of your company or business areas as they stand today. One of my favorite ways to do this is through a SWOT Analysis, which will determine your ‘Current State’.

SWOT stands for Strengths, Weaknesses, Opportunities and Threats.

Sitting down to analyze each of these terms as it relates to your company can be extremely eye-opening.

Before you begin creating your Painted Picture, do a SWOT Analysis. I advise CEO’s that I coach to give all of the key people in your company or leadership team a stack of Post-It Notes (or any small pieces of paper).  Give them ten minutes at most to write down one idea per note pertaining to of the four areas represented by SWOT.  When time is up, have each person read each of their notes out loud and post them up on a wall by category (strengths, weaknesses, opportunities, threats).

After everyone does this, start taking stock of the current state of your company, and where you want to be headed in the future. This will give shape to the key projects you need to complete in order to make the future happen the way you want it to.  Those projects will serve as the basis for your Painted Picture, and the starting point for your own process of reverse engineering.

What have you learned in any recent SWOTs you’ve done.

Before committing to complete a project or set something up as a goal, ensure you spend some time thinking about what the potential return on investment is. That is, what is the return on your investment of time, money or resources in doing this project going to be?  Is it really worth it?

It’s often not about picking which projects to do, but rather it’s about picking which projects NOT to do that will set you up for success.  Recently I had a debate with a woman on Twitter.  She was telling people to spend one hour a day on Twitter, and I said, “Really? Really? Do you really want people spending one out of eight hours every day Tweeting?  Why?” What’s the ROI they are looking for from it?  If you were going to spend 12.5% of your time on one activity such as using Twitter, then in my mind, you’d damn well better have a goal or ROI in mind before starting out.

Every year, about three to four months before the start of the New Year, I mentor CEOs on how to have an Annual Planning Retreat to come up with the top three to five goals for the company. They’ll decide on goals tied to revenue, profit, customer service, employee satisfaction and perhaps something on systems. These annual goals provide the framework for setting quarterly goals going forward.

Every quarter, each business area and each person in your company should be setting up the top three to five goals they will achieve during the quarter to drive the company’s yearly goals.  Imagine the focus your company would have if you knew what each of the top three to five goals each person in your company was achieving every quarter.  Imagine how focused and aligned everyone would become.

High-performing people set goals religiously, track them religiously, they obsess about whether they’re hitting or missing, and why.  Otherwise life just passes by.

When you’re hiring people, ensure you hire people who already set goals in their personal and business lives. Then it won’t be such a stretch to have them setting clear goals in the business each quarter, month and week.

Life isn’t just about goals for your business, though. My goals also include the amount of free time I want in my life.  I set goals for the amount of “Free Days” I’ll have.  A “Free Day” for me is a twenty-four hour period with no email, no business journals, business magazines, newspapers, not a single phone call–it’s just a twenty-four hour period of free time to spend time on the fun stuff in life with people I love.

In 2009, my goal was to have one hundred twenty Free Days.  I had more than one hundred fifty Free Days in the end, however, I got a bit sloppy and checked email randomly from my darn iPhone. I took close to ninety Saturdays and Sundays off, not working at all.  I also took twenty-one perfect Free Days at our cottage in the summer and physically left my iPhone and laptop in Vancouver.  I’m doing it again this summer for sure.

Simply working hard isn’t what it’s all about. As a business coach and mentor, I believe that having the discipline to even take Free Days is the kind of focus you need to give yourself real work life balance, too.   What goals are you setting?

World Cup Soccer Balls

What’s a Goal?

Seriously.

I coach and mentor CEOs to help them grow their revenues, profits, customer satisfaction & employee engagement.

In my coaching role I look at the goals the CEOs set every two weeks.  And often I’m astounded at what I see.  For starters, it’s no wonder that so many companies set hazy goals.  The CEOs are pretty much setting hazy goals too.  And to be fair they also set some awesome ones too.

What’s a SMART Goal though?

In my world of business which started with College Pro Painters back in 1986, we had our own version of SMART Goals.

• Shared – Sharing them with a team member, spouse, coach, boss etc. all make goals stick.
• Measurable – There has to be a number.  We need to know if you Hit or Missed.  Numbers tell us that.
• Attainable – Make them a stretch.  But make sure you can hit them.
• Relevant – Why are you even doing it? Will it drive your Monthly or Quarterly Goals?
• Time Based – When in your calendar will you do it? Not when will it be done by. When will you do it?

Recently, I’ve uncovered one test that really takes Measurable to the perfect level.  The goal MUST have either a # sign, $ sign, or % sign.

So, what are the TOP 5 Goals you’re committing to this week.  Share them with us in the comments.  Let’s see if they are SMART.

In order to make your dreams and objectives a reality, you absolutely have to work backwards. You have to first identify and articulate your goals, and then find the means to achieve those objectives. Instead of flying by the seat of your pants, reverse engineering makes it possible for entrepreneurs to align all of their daily tasks and operations around achieving overarching objectives.

Reverse Engineering is something I use all of the time now, but it wouldn’t be what it is today if I hadn’t attended an EO meeting in 1998.  At that lunch meeting, we were introduced to the concept of ‘visualization’ in sports, which is a technique athletes use. It involves imagining what success looks like in your mind, no matter what the sport, and executing based on that. Whether you’re a long distance runner imagining crossing the finish line or a basketball player who envisions taking it to the hoop, visualization helps you make your dreams a reality. This information, presented by an Olympic coach, further reinforced my belief that if you identify what you want the future to look like—whether for yourself or your organization—you’re going to make it a reality as long as you take the steps necessary to reach your goal. In business settings, calling this the ‘Painted Picture’ demonstrates to entrepreneurs that if you commit to sketching your vision for the future, you’re well-equipped to “reverse engineer” your own success.

Even with my earliest business ventures with College Pro Painters it was all about starting with the profit goal and working it all backwards to figure out what needed to be done to get there.  This is a core concept I use in all the CEO Mentoring I do today.

For more information on this topic, check out: Building a World Class Culture and Leadership at 100MPH.

I was asked recently how I set such concrete revenue goals with confidence.  A few people asked me to show them how I ‘forecast’ to which I replied I don’t really forecast at all.  What I do is more like ‘reverse engineer’ a target that I feel like I can and want to hit.  Then I spend the rest of the year maniacally focused on hitting it.

So – here is how I set my Revenue Goal this year – and how I intend to hit it.  And why I know a 150% increase from 2009 will happen:

1) I first list out all the types of revenue I can generate from my business in its current state.  For me these include:

• Speaking Events
• Coaching/Mentoring Clients
• Strategic Planning
• DVD Sales

2) Then I list out all the types of new revenues I can generate from Projects I 100% know I’ll launch this year if I focus.  They include:

• CD Sales
• Online Webinar deployed learning
• Strategic Alliances/Others Selling my DVDs

3) Then I look at what I can charge for each in 2010…

• Speaking Events – I’ve decided to keep my fees the same for 2010 – $10,000 for Out of Town, $7,500 for Vancouver events, $6,000 for EO or YPO Chapters
• Coaching/Mentoring – I’ve raised my rates for all new clients to $4,200/Mth from $3,500/Mth (20% increase).  I’ve done this because I’m currently close to my self imposed cap on how many clients I’ll work with at the same time.
• Strategic Planning – This will stay the same as in 2009 – $10,000/Day
• DVD Sales – I’m going to raise my rates on these in 2010 – from the current $197 each – to either $297 ea. or $597 ea. (seems crazy & arbitrary – but I’m told there is SO much value in them for Entrepreneurial companies and their employees that I should charge more.  I’ll be doing some online testing with pricing – and doubt it will make a difference.
• CD Sales – This is a product that’s  being asked for and will sell for the same price as the DVDs (it’s the same content – just another way to learn it)
• Online Webinar – I know I’ll launch it this year – but there is so much to do here still that I’m not forecasting any revenue from it at all (it will be a lift for 2011 though)
• Strategic Alliances – This is where I plan to get the biggest lift this year – and have the plans already in place – I need 10 solid companies or people with strong lists promoting my DVDs to their lists – and I’ll share a strong % with them from all revenues.  This will scale…

4) Leading Indicators
I worked hard in 2009 to set up a solid base for 2010 so I’d have strong revenue predictability:

• I’m speaking at the EO GLC in Hong Kong & New Orleans (both will drive speaking events for 2010 & 2011).
• I have 2 strong Canadian Speakers Bureaus – and in December landed 2 very strong USA Speakers Bureaus.
• I’m speaking at the American Society Of Association Executives two conferences
• And have a couple of other strong platforms that will drive speaking for 2010 & 2011
• Speaking is predictable revenues
• At Events I also sell DVDs & CDs
• At Events I meet potential coaching/mentoring clients
• I have 10 solid companies that I am mentoring – 12 is my cap – so I will easily stay at my cap all year (and I’ve budgeted on 10 average – and in 2009 I only averaged 5 as it was a new model)
• Strategic Planning went really well last year with the companies I helped.  I’m not the cheapest but I deliver huge impact while doing these sessions.  Some clients have already said they’ll bring me back.  Some already have me booked.  And my speaking events will put me in front of hundreds of other companies who could use me as well.
• I have a few commitments from major online gurus like Yanik Silver who will be marketing my DVDs to tens of thousands of companies.

5) I know what my bandwidth issues are – and opportunities (i.e. 100% Net Margin DVDs) etc.  So I’m using those to leverage revenues.  And I also know there are brilliant people out there I can pay as a percentage of revenues (thanks Jack Daly for that lesson) and I’ll leverage that too.  Intro’s have already happened.

etc…..

From this rough plan that you’re reading – I already have tight action plans in place for how I’ll hit each one.  I know the exact dollar amount I’m targeting from each category.  I know what I need to do when.  I’ve spent two years building my FaceBook & Twitter followers who are already helping me.  So as you can see.  I’m not just picking an arbitrary goal.  I’m putting tight plans in place to hit it.  And I will.  As do the companies I coach & mentor.

Hopefully you have tight plans in place to hit your goals for 2010 too.  If you don’t, then your goals are merely dreams…