Annual Goals, 2020 Edition

A well crafted goal is Specific, Measurable, Attainable, Relevant, and Time-Bound.

This post originally appeared on the Hermit Haus Redevelopment website on 2016-07-00.

It’s been a while since I’ve talked about goal setting, but this is the time of year when we traditionally review what we’ve accomplished and figure out what we want to do next year. So, I thought it appropriate to review goal setting now. Especially since that’s what I’m doing.

Russell has also written on SMART goals, so I’m not going to rehash that topic. Instead, let’s talk about how we actually pick our annual goals.

1. What do you want to do?

My first step is to make a wish list of everything I want to accomplish in the next year—whether it is personal, financial, operational, or spiritual. This is a stream-of-consciousness exercise. I don’t focus on anything except identification of what I want to do. Grammar, spelling, logic, achievability, timing—everything else is irrelevant for this part of the process.

Here are a few of the many, many items from my wish list:

Flip some houses. Make a horse pasture. Renovate the old church as an event center.

Renovate the Gillis house for the Hearts, Homes, and Hands office. Improve our cash flow. Keep all of our businesses profitable.

Spend more time at the ranch. Spend more time with family. Help people.

2. Clarify and combine objectives.

You’ll notice these wish list items are not very specific, and some of them could be grouped together. So, that’s the next step: clarify and combine my goals. For example: “flip some houses,” improving cash flow, and the two renovation goals could be considered parts of the profitability goal. That goal now becomes, “Improve the profitability of the businesses by 10% year-over-year while maintaining a positive cash flow.”

The horse pasture can be combined with spending more time at the ranch and with family. That goal now becomes, “Spend more time with family by working with the horses at the ranch.” Building the horse pasture is an enabling goal for the annual goal. But “more time” is not very specific. Let’s make that “three Saturdays a month” to leave some time for activities other than horsing around.

Finally, everything in the list falls under “helping people.” So, I’m going to call that an underlaying motivation rather than a goal.

Sometimes one task or goal must be completed before another one can start. For example, we have to move the retention pond (big hole) in the foreground before we can put up the fence that needs to go through it. The silage and hay in the distance have to go elsewhere before the horses can be put in this pasture. The rocks can stay where they are.

3. Create a goal hierarchy.

The goal hierarchy helps you understand which of your goals need to be attained in which order and establish their relative importance to you. For example, we have to renovate the old church before we can use it as an event center, and we have to generate rental income from it to improve cash flow and profitability. Also, the businesses have to be making money to enable me to spend more time with my family.

• Spend three Saturdays each month with family at the ranch.
• Build a horse pasture by the end of the fourth quarter.
• Fence the pasture by the end of the second quarter.
• Build stalls by the end of the third quarter.
• Move the hay.
• Move the horses.
• Improve the profitability of the business by 10% year-over-year while maintaining a positive cash flow.
• Generate income from event center rentals by the end of the first quarter.
• Begin renting the conference room by the end of January.
• Renovate the conference room to a rentable standard by end of the first week in January.
• Begin renting the Sanctuary for bigger meetings by the end of the first quarter.
• Renovate the pulpit area by the end of February.
• Complete ceiling demo downstairs by the end of the first week in January.
• Reduce vacancies and leasing expenses by converting all rentals to two-year leases by the end of the year.

By doing this exercise, I reduced nine random wish-list items to two specific annual goals. You should never have more than three to five annual goals. The more goals you have, the less you can focus on achieving any of them. Focus is the key to success.

4. Remove any remaining ambiguity from the list.

You can have some ambiguity in your goal statements so long as you have clear definitions of what the terms mean. For example, “build a horse pasture” could mean a lot of things. But we have specific plans in place for:

Where the fence should go What kinds of fence material should be used Where in the fence gates need to be placed

Where the horse stalls will be located and how they will be made How to get water to the stalls How to light the stalls

Where and how to store feed.

All that’s left is to figure out where the money comes from.

I’ve recently started to use the Free to Focus planner. I find it a lot more intuitive and “focused” than the Covey system. It is one of the things that have me focused on goals right now.

5. Review the timeline to make sure the dates are attainable.

“Attainable” doesn’t mean “easy.” The timeline should cause a little stress. If it doesn’t, you’re probably not pushing yourself hard enough. In business terms, you’re leaving money on the table.

6. Set a schedule to review and revise your goals.

I review my annual goals at least once a week. The priorities shift as the year goes on, and you have to be flexible. For example, a project going seriously over budget can delay other projects and affect the attainment of goals. That doesn’t mean I rewrite my goals weekly, but keeping the goal line in view means I can understand and communicate how projects relate to and affect each other. (Actually, improving this communication is one of my goals for next year.)

I’ve recently started using the Free to Focus planner. That planner requires me to transfer (by hand) my goals from one quarterly planner to the next. That process also gives me an opportunity to clarify and reprioritize my goals. Writing the goals out by hand reinforces them in my mind in a way that typing them into an online planner does not.

In the end, the way you set and track your goals is as individual a process as what your goals actually are. This process works for me. I hope it helps you, too.

“Uhmm, yeah. I’m gonna need you to work on ... Saturday...”

Setting goals can be a spiritual experience that helps make sure everything you do supports your core personal values. Background photo by: NASA

This post originally appeared on the Hermit Haus Redevelopment website on 2019-11-12.

I know a lot of people who hate the idea of setting goals. This aversion can make it difficult, if not impossible, to accomplish anything useful—except by accident. I believe the reluctance to set goals stems from the way we were forced to set them and ignore them in favor of 10,000 trivial tasks in the corporate world—only to be punished for not accomplishing them in our annual review.

Yes, I’m talking to you, computer industry!

But I have come to view goal setting as a spiritual practice. It focuses your intent on what matters to you.

All of your goals should derive from your personal values or principles. But you must first identify what those are. Once you do, you can use them to determine whether the 10,000 things that beset you in the course of your daily life support your values or distract you from them. With well-defined goals, you can quickly determine which tasks are important, which you should do now, which you should put off, and which you should ignore. Many of the things that seem urgent in the moment resolve themselves if you ignore them, but others can still come back to bite you in the butt.

An Example

Scheduling your time appropriately probably supports every value you have, from fighting homelessness to spending more time with your family watching Power Ranger reruns for the hundredth time.

Values

Before you can set goals that support your personal values, you must first determine what those values are. Values are what really matters to you. I like to think about values as nouns—ambiguous ones at that. Some values might include:

• Integrity
• Frugality
• Kindness
• Social responsibility
• Family and other relationships
• Independence
• Spirituality

SMART goals help you stay on track to support your values. This picture is one of my computer desktops. I am such a geek!

Attainable Goals

The goals you set to support your values should be attainable, something you can get done. I have talked about SMART goals elsewhere, as has my partner, Russell Mangum. So, I won’t distract you by repeating myself here. Not too much.

Let’s say you have an aspirational value of Social Responsibility, and you’ve decided you want to do something about homelessness. An attainable goal to support that value might be to help Habitat for Humanity build two affordable houses this year.

Milestones

Each of those two houses is a milestone you can check off once it’s built.

Steps and Tasks

Now it gets interesting. To meet that goal, you can contribute your time, your money, or both. Each of which involves layers of tasks and sub-tasks.

If you choose to donate $1,000 of your time, you have to:

• Determine how much an hour of your time is worth.
• Divide $1,000 by your hourly rate to determine how many hours (more or less) you need to contribute.
• Coordinate your schedule with Habitat’s to know when you need to work.
• Prioritize that time to keep it available so nothing prevents you from helping out.

Real World Intrusions

Understanding your values and the goals that supports them helps you decide what to do when an “urgent” task tries to invade your awareness. It enables you to focus your intent on what matters to you and even helps you identify and resolve conflicts between values. So, the next time your boss wants you to work on a Saturday you already have devoted to something else, you can think about it and decide what you want to do. Working that day may bring in more money that you could satisfy multiple values. You could donate the extra money (assuming overtime) to Habitat and provide for your family by keeping your boss happy. Or you could decide what you already had planned is more important to your values and happiness.

Each new request, each new item on your unending to do list is an opportunity to support your values or a distraction from them. It’s really all your choice.

Setting Your Goals Starts the Process

These are the qualities of a well-crafted goal. For example, we want to acquire 36 properties (specific, measurable, and relevant) this year (time-bound). It should be attainable, but it is our stretch goal. Photo by: ClipartFest

This post originally appeared on the Hermit Haus Redevelopment website on 2017-01-31.

Only you can define success for your business. Don't let anyone try to convince you you're not successful if you're meeting the goals you establish for yourself. If you want to rehab just one house this year, you're a success if you accomplish or start one project. If you do that, and you want to, you can set a higher goal next year.

But you can't stop with just setting a goal. That just starts the process.

Let's focus on 12 projects for the year. What do you have to do to get there? You can't just look at 12 houses, buy them, rehab them, and sell them. Well, you can, but not if you want to make money and stay in business.

There are basic numbers for each stage of the deal. At Hermit Haus, we know we closed on about 60% of the houses we got under contract, or about or about 42% of our offers. We made offers on almost 46% of our active leads. And only 36% of our prospects became active leads. All-in-all, we acquired about 4% of the prospects that crossed our desk. (We can debate the efficacy of those numbers at another time.)

Think about that. To buy a house, we had to have 25 prospects, and our acquisition rate is much higher than the industry norm. (One reason is we only track the prospects we spend time on, not everything that gets presented. And I still don't expect to be able to keep the ratio that high this year.) To buy 12 houses, we would need at least 300 prospects. That's more than one serious prospect every business day. And our actual goals are significantly higher than 12 projects this year. We don't want to manage 36 at a time like some folks we know do, but we have shown we can certainly manage more than five at a time.

And managing multiple projects requires managing your goals. Next time, I'll talk about how I do that at Hermit Haus.

If you have questions about goal setting or want to help us attain our goals, email me or leave a comment.