How to Set Company Goals? The Formula of Objectives

To set company goals effectively, combine a motivating story with clear numbers and realistic strategies, following the formula: (Story + Number) / Strategies = Goals.

When you examine great achievements, you see the same characteristic at the start: goals that are assertive, exciting, inclusive and built for collaboration. The most important element in the goal's formula is the story side of the goal that touches on emotions.

Edwin Locke, Professor of Psychology at the University of Maryland, identified two factors that increase and motivate goal performance. First, the goal should be inspiring and challenging — non-ambitious goals do not create performance improvements. Second, the goal should be clearly defined; a strong but vague goal fails to motivate. A clear, well-defined goal activates a person when it matches their competencies.

Deloitte's 2014 and 2015 studies reinforce this: clearly defined, written and freely shaped goals are the most motivating and performance-enhancing elements a company can use. Correct targeting also increases employee loyalty.

Company Goals to Increase and Motivate Corporate Performance

As Aswath Damodaran explains in Narrative and Numbers, if you're going to define a goal, you need a story and the numbers that support it.

Goal's Story

This is the inspired, meaningful dimension of the work — a narrative aligned with the company's vision and mission, or with personal principles and values, set within a defined timeframe. Defining the right goal is challenging in both personal and business life. Without enough motivational strength, the route deviates and new targets become necessary.

Numeric Goals

When numbers are involved, the imagined outcome becomes clearer. Words and numbers are two essential dimensions of goal-setting; separating them breaks the balance and the route can shift instantly. Adding numeric dimensions grounds your ambitions and sharpens the picture.

Deciding on peak targets means ensuring the right focus for your most important capital: time and energy. What does your dream future look like for your company or yourself? Picture it in words. How does each stakeholder appear in this picture? What has changed positively for them? And the key question: how did you achieve it? This is the second component of the goals formula.

The Formula: (Story + Number) / Strategies = Goals

For strong company goals, the starting point must be defined with the same rules — story and number for the current situation, based on past data. SMART goals, which combine numbers and stories correctly, remain valid for this purpose.

Creating SMART Goals

For example, if you have a wellness goal, define your current situation: how many pounds to lose, which activities to do. For a business project, define the reason behind it, the supporting data, what success looks like at completion, and how you'll measure it going forward.

"For each goal, you make the most important investment: time, the single resource given equally to all people."

Planning time correctly is critical for a balanced life. It's unrealistic to invest all your time in one goal before starting another — targets need to be managed and synchronized simultaneously.

Compelling but Achievable

Goals must be difficult but achievable to stay motivating. Which is more realistic: a one-year plan to lose 10 pounds, or losing 2 pounds this month through diet and exercise? The first feels intimidating and motivation drops as the timeline widens. The second is manageable, and each monthly success builds motivation. The same logic applies to learning a language — a one-month goal to use new tenses confidently is more sustainable than a one-year goal to give a full presentation.

The same applies to business. Setting the right company goals requires research from reliable sources — market, competition, economy, customers, employees — combined into an objective analysis. Vision and mission guide how you'll reach the targets. Leadership plays the most important role here: deciding which vision is the right direction and which route is fastest, most profitable and most efficient.

In the business environment, each employee is also a leader. They are responsible for analyzing their current status, determining their destination and deciding how to get there.

As leaders, we need to define our own story and our own numbers. In the past, company goals had a longer horizon, with 1-3 year roadmaps. Today, dynamic markets and shifting competition make even monthly planning valuable. Is it still possible to define targets and work with large teams while adjusting course when necessary? Yes.

Working in Short Cycles

Define the peak goal correctly, break it into steps, and design around uncertainty in short slices of 1-3 months. Test and measure whether you're on track, then redefine your steps and repeat.

Successful companies build this habit using systems like OGSM and OKR. OGSM (Objectives + Goals + Strategies + Measures) defines long-running top goals, while OKR (Objectives and Key Results) spreads peak targets to all employees quarterly. Both models work effectively for companies and individuals alike.

A performance module compatible with these management methods — where each employee can monitor company progress and see their own contribution instantly — is critically important.

With quarterly goals and maximum employee contribution, agility becomes part of the corporate culture, driving deeper institutional transformation.

For successful performance management results, put employees at the center and share 3- to 6-month goals based on employees' skills and willingness to take initiative. Effective leadership and strong employees' skills together determine whether these goals translate into real performance.

Are you ready to set peak targets and leave the rest to your employees?

Dilek Mete
Performance and Culture Development Expert

Frequently Asked Questions

How do you set company goals effectively?

Combine a motivating story with clear numbers, then divide by realistic strategies: (Story + Number) / Strategies = Goals. Goals must be inspiring, clearly defined and matched to competencies.

What is the formula for setting objectives?

The formula is (Story + Number) / Strategies = Goals. The story provides emotional meaning and vision alignment, the numbers ground the goal in measurable data, and strategies define how to achieve it.

Why are SMART goals still relevant for company objectives?

SMART goals combine narrative and numeric elements correctly, ensuring goals are specific, measurable, achievable, relevant and time-bound, which keeps teams motivated and focused.

What is the difference between OGSM and OKR?

OGSM (Objectives, Goals, Strategies, Measures) defines long-running top-level goals, while OKR (Objectives and Key Results) breaks peak targets into quarterly goals shared across all employees.

How often should company goals be reviewed?

Given dynamic markets, goals should be broken into short 1-3 month cycles, tested, measured and redefined regularly rather than planned only annually.