How to Measure Progress and Achieve Goals

Measurement! I just love measurement. That’s because it tells you how you’re doing and how much progress you’ve made. Progress checks can motivate you, help you catch yourself when you’re slacking, and tell you when to change course. 

Without giving thought to how you define progress, however, you can measure the wrong thing, or measure the wrong way. You might end up demoralized for no reason, or falling behind unknowingly on a project, or missing opportunities. So if you’re going to measure progress, do it right! Turn off auto-pilot “gut checks” and measure progress thoughtfully.

Measure process goals

If you’re Type A like me, you probably overwork yourself, under the assumption that more work gives more progress. But does it? Have you ever measured? Just being busy and stressed doesn’t mean we’re getting anything done. We need to track how far we are from our goal, and whether we’re closing that gap.

First determine the kind of goals you’re chasing. Episode 462, “Grow a Pair for Your Career,” outlines the difference between outcome goals and process goals. Outcome goals—like getting a promotion—are something you strive for, not something you just do. Process goals, on the other hand, are measurable actions that help you get closer to your outcome goal, like making ten more sales calls each day. 

If you’re going to measure progress, do it right! Turn off auto-pilot “gut checks” and measure progress thoughtfully.

On a daily basis, measure progress through movement toward your process goals. It doesn’t matter how much you work, only whether that work takes you closer to finishing that day’s process goals. Then check that your process goals are doing what they should, by tracking overall movement toward an outcome goal.

For example, if you work in sales, your process goal might be to make fifty cold calls a day. If that’s your goal, sending two hundred emails should not count as progress. What’s more, if your outcome goal is to close sales, and you haven’t closed one in months, you may need to rethink if you have the right process goals. Maybe “number of calls” doesn’t lead to sales. Maybe you need to make progress on the quality of your calls, instead. So make your new process goal tweaking your sales pitch, and direct some work toward that.

Measure how far you’ve come

Another way to track progress is to look at how far you are from your starting point. 

Sam is a twenty-something who’s just started up a fairly successful online delivery company. The vision of being the next Amazon.com seems impossible! Or at least, light years away. And it is. But knowing that it’s not Amazon yet isn’t a useful measure for evaluating progress. Furthermore, it’s so far away that it isn’t even clear which paths lead to that result.

Sam can instead concentrate on what’s been accomplished so far. They started sitting around a dining room table. Now they have office space, customers, a business model that works, money in the bank, and profit. By measuring progress based on how far they’ve come, not on how far they have left to go, Sam can realize they’ve made tons of progress, and can make sure it continues to unfold, as more and more milestones get added to the list.

Measure distance to your goals

At some point your goal is within reach. Then, you can start measuring how far you are from your goal, and concentrate on closing the gap.

Don’t do this too soon! You can hurt morale. At my last Harvard Business School reunion, for example, doing an “Am I there yet?” progress check gave me a soul-crushing burst of inadequacy as I was moderating a panel of my classmates, whose combined net worth was enough to purchase a third world country and pave it over. In gold. 

When you’re out on a long run, you get a surge of fresh energy when you see you’re only ten feet from the finish line, and there’s an entire 55-gallon drum of gummy bears waiting at the end. And an Oreo ice cream cake. The next thing you know, you’re barreling over the finish line.

When you’ve passed the halfway point, start measuring your progress by how quickly you’re closing on your goal. Keep that Oreo ice cream cake in mind, and set new goals to push you those last few feet.

Even if you get some steps wrong, just making the plan will energize you and be motivating.

A good way to do this is to make a checklist of things you’ll need to do to reach the end point. These can be high-level things like, “Run A/B testing with focus groups,” or low-level things like, “Write an email to call for A/B testing participants.” Once your plan is on paper, finishing your project will seem much more doable, since all the steps left to take are right there in front of you. And as I talked about in episode 466, "Make a Plan for Motivation," even if you get some steps wrong, just making the plan will energize you and be motivating.

Re-measure often

Once you figure out the best way to track your progress, and the types of progress you need to track, choose how often you’ll track. Sometimes, tracking progress once a week is plenty. But from my experience, it’s best to track progress every two to three days.

That way, if you suddenly notice you’re not where you should be, you only have to make up two or three days’ worth of work. If you were only checking once a week, you could get an entire week behind before you’d notice it.

From my experience, it’s best to track progress every two to three days.

What gets measured gets managed. And we love to manage progress. On a daily basis, concentrate your measurements on your progress goals, rather than your outcome goals. Then choose a less-frequent measurement that is based on where you are in your project: distance to your goal, or distance from your starting point. With a little experimentation, you can find the magic balance that keeps you on top of your game.

This is Stever Robbins. I give great keynote speeches on productivity, Living an Extraordinary Life, and entrepreneurship. If you want to know more, visit http://SteverRobbins.com.

Work Less, Do More, and have a Great Life!

How Can Your Small Shop Get Off To a Roaring Start?

Are you just trying to get your own shop or retail business off the ground? Do you have physical items to sell but don’t have the capital to open a brick-and-mortar store? With the latest iPad point-of-sale (POS) systems, you can sell your products, manage your inventory, show your products to potential customers, and even analyze your progress. This allows you unparalleled flexibility to alter your business strategy for the best results in today’s rapidly changing retail landscape.

Whether your own shop or retail boutique is still a glimmer in your eye or you’ve investigated avenues to making it a reality, you may not realize just how easy it can be to get up and selling. Renting retail space may not make as much sense during a pandemic, but there are other ways to get your products in front of your prospective customers beyond the online arena.

One such way is to investigate opportunities for popup store locations in your area. Farmers markets are great for this, but you need a location that’s equally effective in warm or cold weather. All across the country, malls are looking to repurpose themselves as their anchor department stores go bust. Many mall owners, noting the consumer trend toward buying local, are looking to fill these spaces with small-scale merchants like you. Combining a popup location when it’s cool with an outdoor spot when it’s warm could give you an effective high-traffic spot without shelling out what it would cost to rent, say, space in a strip mall or downtown location.

Get up and running

When you think of opening up your own store, you probably picture a daunting checklist as long as your arm and myriad expenses that would make launching such a venture unacceptably risky. But it doesn’t have to be that way. Today’s POS providers offer packages that can get you up and running for less outlay than you might imagine.

Part of the problem with traditional POS systems was that they were so cumbersome to learn that you could spend a month digging into their complexities and still be unable to perform some basic functions. iPad POS systems are far more intuitive, which means you’ll be able to take advantage of everything the system can do within hours, not days, weeks, or months. At first, you’ll barely be scratching the surface of your system’s capabilities, but as you grow you’ll be well served to take advantage of key features such as inventory management and customer tracking.

Optimize your inventory

The true power of today’s mobile POS systems lies in their ability to track your sales and help you manage your inventory based on your results over time. What do you sell the most and when do you sell it? What’s collecting dust? You’ll be able to view all of this at a glance, and more importantly, you’ll be able to take appropriate actions to load up on what sells and rid yourself of what doesn’t. If you do have an online store, most systems allow you to integrate your inventory management so that someone shopping online isn’t surprised that an item they want is actually out of stock because it was sold to a walk-up customer or vice versa.

Customer tracking and rewards

These days, customers have become accustomed to sharing some data with their favorite shops. This is especially true when they're rewarded for doing so. Forging mutually beneficial customer relationships takes time and can cost you a bit in the short term. However, in the long term, they can pay huge dividends not only in frequent repeat business but also when it comes to spreading the word about your shop on social media and among friends and colleagues. It’s never too early to start identifying and rewarding your loyal customers.

Fortunately, most POS software makes this easy. Simply by providing the phone number or email where they would like their receipt sent, you can start building a profile of their likes and dislikes. You can also use this info to send them promotional messages, though you will need to make sure they opt in to this service.

Customer tracking is a win-win. They win because you can use their preferences to recommend products in which they will likely be interested; you win because you can keep presenting them with products that they’re eager to buy.

If you do start building an email or SMS list, that’s an excellent way to reach out to them with a killer deal when things are slow, or to let them know about an item that you're sure they’ll want to see. Take care, though—it’s very easy to overuse these capabilities, which can drive customers away and turn them into brand ambassadors of the worst kind, former customers who tell prospective customers to stay away. However, done with the right touch, direct marketing programs can bring in a solid core of business on which you can expand.

Contactless payment

With the pandemic raging, no one is eager to touch surfaces outside their home. That’s why it’s so critical to employ a contactless payment solution. iPad POS providers charge a bit more for these card readers, but being able to loudly tell potential customers that you have this capability will pay for the additional expense and then some.

Setting up your own shop is far from a walk in the park, but with a solid plan and a simple iPad POS solution, it need not be nearly as complicated as it has been in the past.

Your Guide to Claiming a Legit Home Office Tax Deduction

I’d bet that on just about every city block or long country road, someone is operating a business from their residence. According to the U.S. Small Business Administration, about 50 percent of businesses are home-based, with a larger percentage (60 percent) working as solopreneurs with no employees.

Having a home-based business is one of the easiest and least risky ways to become an entrepreneur, test your business ideas, and increase your income. No matter if you run a business full-time or as a side gig, claiming the home office deduction can significantly reduce your taxes.

No matter if you run a business full-time or as a side gig, claiming the home office deduction can significantly reduce your taxes.

I received an email from John, who says, “My New Year's resolution is to earn more money working during my off-hours and on weekends. Since the work will likely entail making deliveries for different mobile apps, I’m not sure if it qualifies me for the home office tax deduction. Can you explain more about it?”

Thanks for your great question, John! In this post, I’ll give an overview of the home office deduction. You’ll learn who qualifies, which expenses are deductible, and how to legitimately claim this money-saving tax break no matter what type of business you have.

Who can claim the home office tax deduction

If you work for yourself in any type of trade or business, either full- or part-time, and your primary office location is your home, you have a home business. The designation applies no matter whether you sell goods and services, are a freelancer, consultant, designer, inventor, Uber driver, or dog-walker.

If you work for yourself in any type of trade or business, either full- or part-time, and your primary office location is your home, you have a home business. 

You can have a home-based business even if you’re like John and mostly earn income away from home. This is common for many trades and solopreneurs, such as musicians, sales reps, and those working in the gig economy. If you’re self-employed and do administrative work like scheduling, invoicing, communication, and recordkeeping at home, you have a home business.

Note that employees who work from home can’t claim a home office deduction. W-2 workers used to be allowed to include certain expenses if they itemized deductions. But tax reform took away that benefit starting with the 2018 tax year.

The home office deduction is available for any self-employed person no matter whether you own or rent your home, with the following two requirements:

  1. Your home office space is used regularly and exclusively for business
  2. Your home office is the principal place used for business

You must regularly use part of your home exclusively for conducting business. For example, if you use a guest room in your house or a nook in your studio apartment to run your business, you can take a home office deduction for the space.

You don’t need walls to separate your office, but it should be a distinct area within your home. The only exception to this “exclusive use” rule is when you use part of your home for business storage or as a daycare. In these situations, you can consider the entire space an office for tax purposes.

Additionally, your home must be the primary place you conduct business, even if it’s just the administrative work you do. For example, if you meet with clients or do work for customers away from home, you can still consider the area of your home used exclusively for business as your home office.

Your home doesn’t have to be the only place you work to qualify for the deduction. You might also work at a coffee shop or a co-working space from time to time.

You could also consider a separate structure at your home, such as a garage or studio, your home office if you use it regularly for business. Also, note that your home doesn’t have to be the only place you work to qualify for the deduction. You might also work at a coffee shop or a co-working space from time to time.

RELATED: How to Cut Taxes When You Work From Home

Expenses that are eligible for the home office tax deduction

If you run a business from home, two types of expenses are eligible for the home office deduction: direct expenses and indirect expenses.

Direct expenses are the costs to set up and maintain your office. For instance, if you work in a spare bedroom, you might decide to install carpet and window treatments. These expenses are 100 percent deductible, no matter the size of the office.  

Indirect expenses are costs related to your office that affect your entire home. They’re partially deductible based on the size of your office as a percentage of your home. 

For renters, your rent, renters insurance, and utilities are examples of indirect expenses. You’d have these expenses even if you didn’t have a home office.

For homeowners, you can't deduct the principal portion of your mortgage payment, which is the amount borrowed for the home. Instead, you’re allowed to recover a part of the cost each year through depreciation deductions, using formulas created by the IRS.

Other indirect expenses typically include mortgage interest, property taxes, home insurance, utilities, and maintenance. Allowable indirect expenses actually turn some of your personal expenses into home office business deductions, which is fantastic!

Allowable indirect expenses actually turn some of your personal expenses into home office business deductions, which is fantastic!

However, expenses that are entirely unrelated to your home office, such as remodeling in other parts of your home or gardening, are never deductible. So, your ability to deduct an expense when you’re self-employed depends on whether it benefits just your office (such as carpeting and wall paint) or your entire home (such as power and water).

Also, remember that business expenses unrelated to your home office—such as marketing, equipment, software, office supplies, and business insurance—are fully deductible no matter where you work.

How to claim the home office tax deduction

If you qualify for the home office deduction, there are two ways you can calculate it: the standard method or the simplified method.

The standard method requires you to determine the percentage of your home used for business. You divide the square footage of the area used for business by the square footage of your entire home.

For example, if your home office is 12 feet by 10 feet, that’s 120 square feet. If your entire home is 1,200 square feet, then diving 120 by 1,200 gives you a home office space that’s 10 percent of your home. That means 10 percent of the qualifying expenses of your home can be attributed to business use, and the remaining 90 percent is personal use. If your monthly power bill is $100 and 10 percent of your home qualifies for business use, you can consider $10 of the bill a business expense.

To claim the standard deduction, use Form 8829, Expenses for Business Use of Your Home, to figure out the expenses you can deduct and then file it with Schedule C, Profit or Loss From Business.

The simplified method allows you to claim $5 per square foot of your office area, up to a maximum of 300 square feet. So, that caps your deduction at $1,500 (300 square feet x $5) per year.

The simplified method truly is simple because you don’t have to do any record-keeping, just measure the space and include it on Schedule C. It works best for small home offices, while the standard method is better when your office is larger than 300 square feet. You can choose the method that gives you the biggest tax break for any year.

But no matter which method you choose to calculate a home office tax deduction, you can’t deduct more than your business’ net profit. However, you can carry them forward into future tax years.

As you can see, claiming tax deductions for your home office can be complicated. I recommend that everyone who’s self-employed use a qualified tax accountant to maximize both home office and business tax deductions.

Yes, professional advice costs money. But it’s well worth it, and it usually saves money in the long run when you know how to take advantage of every legit tax deduction.