Understanding The Importance Of Goal Setting In Organizational Behavior

Research questions

Describe about the Goal Setting?

Goal setting is an integral part of the organizational behavior that involves the development of strategies in order to motivate employees within the organization and help in attainment of long-term goals. Vigoda-Gadot and Angert (2007) suggested that appropriate goal setting is important in an organization because it provides focus, increases motivation, improves group cohesion and help in performance measurability. The literature review here focuses on the concepts and theoretical models related to goal setting within an organization. With the help of this document, the researcher ensures effectiveness and influence of goal setting within an organization to set the baseline of a plan and to take decisions effectively. With the help of secondary academic review the researcher will be able to obtain an in-depth knowledge on the topic.

• How does goal setting models helps in enhancing the organizational performance?
• What are the major goal setting models followed by your organization?
• How effective do you think is the present goal-setting model in your organization?
• How do you think the goal setting techniques motivate employees?

3.1 Locke and Latham’s Goal setting theory

According to Locke and Latham (2006) the concepts of Management by objectives (MBO) and goal setting theories became major fields of study within the segment of organizational behavior because goals and objectives are the key elements that creates a positive organizational climate, improves job motivation, provides social and emotional support and enhance overall performance levels.  Reed (2012) suggested that goals are related with performance enhancement because they organize effort, directs attention and encourages determination and plan development. In determining the relationship between goals and performance levels two main concepts are important namely the concept of Goal difficulty and the concept of Goal specificity. Murphy (2013) suggested that ambitious goals can contribute to the motivational increase of the individuals and thus enhance the overall performance levels.

Lunenburg (2011) opined that goals have an inescapable influence on the behavior of the employees and thus influence the long-term performance of the employees within an organization. The goal setting theory proposed by Locke and Latham in 1960 emphasized on the fact that clear and specific goals and effective feedback can essentially motivate employees. According to Locke and Latham (2006), there are five important principles of goal setting that can improve the success rates within an organization namely clarity, challenge, commitment, feedback and task complexity. This theory states that goal setting within an organization should be a dual process. The individual employees should set a personal goal whereas the management of the organization should also focus on setting a team goal in order to comprehensively attain both individual growth and organizational growth. Vigoda-Gadot and Angert (2007) suggested that the willingness of wok towards the attainment of the goal is the major source of motivation for the employees within an organization. However, Bazerman (2009) argued that in some circumstances there might be rise of conflict between the personal goals and organizational goals. Moreover, the theory states that the organizations should frame complex goals so that the attainment of the same may bring a sense of self-satisfaction within the employees and further motivate them to increase their productivity. However, Sinnema and Robinson (2012) commented that high complexity of goals might make the goals unattainable. Finally, it has been argued that goal setting may not necessarily improve the job satisfaction levels.

Theories and Concepts on Goal Setting

Figure 1: Goal setting theory

(Source: Locke and Latham , 2006, pp- 267)

The necessary conditions that make goals effective and enhance the performance levels by invoking motivation within the employees are namely Goal commitment, Goal specificity, Goal difficulty and feedback related to goals. The following segment discusses the conditions.

Goal commitment in simple words denotes the acceptance of the goal by the individual. The acceptance of the goal is the initial step towards the motivation of the individuals. Rug and Wallace (2012) commented that if the goal is achievable and realistic then the rate of acceptance is high and with the advent of acceptance, the individual applies the required degree of determination and self-efficacy in order to complete the goal.  However, Lawlor (2012) the rate of commitment may be hampered if the individual does not find the goal to be important. Hence, in order to successful make a goal achievable the organizations must exert the importance of the goal on the employees. The major factor that the organization needs to avoid in this context is the development of a casual attitude of the employees relating to the goals. For this Rug and Wallace (2012) suggested that the organizations should effectively provide all details about the goals, should establish a relation between the goal and the organization’s ,mission and should also show the advantage that the individual may incur from the attainment of the goal.

The specificity of the goal is ascertained by its measurability. Bazerman (2009) suggested that highly specific goals affect the performance levels. Vague and abstract goals make it difficult for the employees to decide on the type of performance and quality of performance that the individuals should generate. The goals should thus be clear in terms of the specifications thereby assigning the actual tasks that the organization requires the employees to meet. The major focus of the management of the organization should be on the removal of the ambiguity from within the goals. For instance, the sale persons are given specific monthly targets that they have to achieve and the specification of incentive structures that they might get on achieving more than the monthly targets. According to Sinnema and Robinson (2012) the numerical targets makes the targets more realistic and highly motivates the employees to achieve the same. Further depending upon the skills of the employees the management can enhance the goal challenges and specifications.

According to Vigoda-Gadot and Angert (2007) to encourage high performance levels the organizations should formulate highly difficult goals. However Simões et al., (2012) argued that the difficulty level of the goal should depend upon the human skills present within the organization so that the level is achievable otherwise the goal difficulty can de motivate the employees and reduce their productivity. Ordóñez et al. (2009) suggests that the individuals have a tendency to act or respond dishonestly in case the goals become unattainable or difficult compared to their skills. Thus, it is essential for the organization to set the difficulty levels correctly in order to enhance the performance levels. For instance, Ford’s goal to gain market share in the international market forced the company to compromise on the quality standards of the new car Pinto that resulted in accidental deaths of around 53 consumers. Thus, the example shows that high standard settings are often detrimental to the success of the employees and the organization. Ordóñez et al. (2009) added that difficulty level of the goals should remain within the power of the employees and the organization. In order to do so the organizations can conduct a SWOT analysis that will reveal the internal strengths and threats of the company in order to help them generate the necessary goal standards. A high goal not only jeopardizes motivation and commitment but also creates a non-congenial environment where the employees engage in corruption, dishonesty and hampers the quality of the organizational performance. Bennett (2009) concluded that the performance graph sharply declines with the increase in the level of goal difficulty.

Locke and Latham’s Goal-Setting Theory

Figure 2: Relationship between performance level and goal difficulty

(Source: Bennett 2009, pp- 98)

Feedback is an important element for performance evaluation. Simões et al. (2012) suggested that feedback is important also in case of goals in order to judge the effectiveness of the goal and the effectiveness of the commitment related to the goal completion. In the absence of feedbacks the employees remain unaware about their progress and it becomes difficult for them to ascertain the level of commitment that is further required for the job. Moreover, feedback process helps in identifying any loopholes within the goal and enables the individual to make necessary modifications. However, Murphy (2013) pointed that feedback should be constructive. The leaders and the goal makers should try to be specific while giving feedbacks. They should clearly mention the changes they require. Positive feedback also acts as a motivational factor for the enhancement of the performance levels. In this regard, Greenberg (2011) commented that feedback could be process oriented or outcome oriented. Thus by receiving the feedbacks the individuals will be aware that their work is being evaluated and this will minimize their chances if mistakes and act as amoral support for them.

In order to mend the problems of the goal setting theory the advent of SMART goals were made. Lawlor (2012) stated that development of SMART goals helps the organizations and employees to make the goals quantitative in nature, which helps easy attainment of the goals. The mangers adopt the following parameters while designing SMART goals.

S = Specific goals

M = Measurable goals

A = Attainable goals

R = Relevant goals

T = Time bound goals

Stringer and Shantapriyan (2012) opined that the specificity within the goals helps the employees and the managers to concretely define the task that is to be undertaken. The specificity of the goals gives the employees an opportunity to undergo the training process, which increases their individual productivity as well. Further, by making the goals measurable, the organizations are able to judge the feasibility of the goals. The achievability characteristic of a goal makes the goal viable and the organizations can design the desired resources in order to make the goal achievable. The relevancy of the goal motivates the employees to try and achieve the same. Finally, a time bound goal highlights the approximate time frame within which the organization plans to achieve the goal successfully. However, Reed (2012), pointed out in article that even SMART goals are not always effective for the organization. It is easy for the organizations to set ambitious goals however; the attainment of the same may divert the organization from other functional areas. For instance, a specific goal concerning the attainment of high market share in a particular target market may make the organization easy target in that market. Reed (2012) further commented that the high attainable goals as set by the SMART goal concept required high degree of skills and training in order to make the goals attainable. However, the organizations are more focused on the setting of the SMART goals without any focus on the skills requirement of the employees thus making the goals unattainable.

Goal Setting Theory Conditions

Figure 3: SMART goals

(Source: Stringer and Shantapriyan, 2012, pp-192)

The major role of an organizational leader is to effectively coach the employees to perform to their best abilities. The GROW model of goal setting is a simple and widely used tool for simple organizational structures in order to coach the employees in order to attain the goals. The following table shows the questions farmed at every stage of the GROW model.

G – Goal	What does the organization hope to achieve?
R – Reality	What is the current position of the organization?
O – Options / obstacles	What are the different alternatives and problems available to the organization?
W – Will	What are the plan concerning the goals and obstacles?

Reed (2012) commented that this model takes into account the views of the SMART goals in stage one and further designs the organizational activities that will help in attainment of the SMART goals. The organizations by establishing the reality can account for the present condition of the organization as well as the employees. This helps the management leaders to effectively judge whether the essential skills and trainings are present within the employees, whether the organization has required financial and technical resource in order to successfully attain the SMART goals. Strongman (2013) further added that assessment of the obstacle and options helps the organizations to analyze the external environment before engaging in goal attainment actions. The use of SWOT, PESTLE and Porters 5 force gives the organizations the opportunity to analyze the potential threats and opportunities in the path of the desired goals. The recognition of the barriers will help the organization to make strategies for avoidance and recognition of opportunities will give the organization to build a strong competitive advantage over the other players within the industry.

However Grant (2011), argued that GROW model may be ineffective in case of one-to-one interaction between an employee and a leader. The leader in this case may focus rigidly on the principles of the model rather than paying appropriate attention to the ability, skills and mind frame of the employee. Thus excessive use of the principles of GROW within the organizational leadership context may give rise to a strict and inflexible organizational structure. Moreover Urbany and Davis (2010) added that the leaders using the GROW model for the purpose of coaching generally tends to avoid laying the foundations among the employees and try to generate fast achievement of the goals.

Figure 4: GROW model

(Source: Grant, 2011, pp- 120)

4. Conclusion

While conducting researches by going through the case studies on setting goal, three models have been undertaken by the different organizations for performance improvement by setting appropriate and attainable organizational goals. The chapter helps the researcher to gain insight knowledge on the different positive and negative aspects of goal setting actions. Thus from the overall analysis it can be concluded that the organizations can use the elements of the different models of goal setting effectively but also not rely rigidly on the principles without paying any attention to the resource availability and human skills. Rigidity of the models may result in setting of ambitious and difficult goals, which may sound good from the organizational prospective but, may hinder the ethical considerations and reduce the performance levels of the individuals within the organization.

Reference list

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Bennett, D. (2009). Ready, aim… fail. Why setting goals can backfire. The Boston Globe, C1

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Vigoda-Gadot, E., and Angert, L. (2007). Goal setting theory, job feedback, and OCB: Lessons from a longitudinal study. Basic and applied social psychology,29(2), 119-128.