Goals are everywhere in organizations. We have strategic goals, personal performance goals, development goals, financial goals, etc. As often happens, organizations can mistake ubiquity for mastery and adopt a "just do it" approach to goal setting and management. This is a shame - and potentially irresponsible - given that there is a deep body of evidence to help us put in place goal-based practices that work, and avoid those that do not.
Goals are a valuable tool to make strategies come alive in organizations. Understanding how to use them well to drive organizational performance is critical to any strategy management effort. Below, I've summarized some key ideas from goal setting theory as reflected in the research of Edwin Locke and Gary Latham. (These guys have been studying this for almost 50 years!) If you are leading efforts that use goals to drive performance, I'd encourage you to read the research yourself, starting with Locke and Latham's seminal 2002 article.
GOALS HAVE A FUNCTION.
Goals impact performance because they are:
- DIRECTIVE - Help focus attention.
- ENERGIZING - Encourage greater effort.
- CLARIFYING - Make accountability explicit.
- ACTIONABLE - Encourage skill use/development.
ALL GOALS ARE NOT CREATED EQUAL.
Goals have a greater impact on performance when they are:
- SPECIFIC - Rather than general/"do your best"
- DIFFICULT - People work harder when challenged
Goals have about equal impact on performance when they are set via directive (set by managers), as when they are set with employee participation — if the rationale for the goal is explained.
Goals can decrease performance, if their complexity is too high or beyond the ability of staff. Learning goals, rather than performance goals, can help in these circumstances.
GOALS ALONE ARE NOT SUFFICIENT.
Beyond setting goals, additional mechanisms are necessary to improve performance:
- COMMITMENT - Goal achievement must be important to staff and managers.
- ALIGNMENT - Personal and group goals must align to avoid tension & maximize impact.
- FEEDBACK - People must understand how they are doing relative to the goal.
Leaders positively affect performance related to goals when they:
- EXPLAIN & INSPIRE - Share the rationale for the goal and the related vision.
- ARE ACCOUNTABLE - Publicly commit to the goal(s) and emphasize their importance.
- BELIEVE - Express confidence in staff members' ability to achieve the goal.
- SUPPORT - Ensure opportunities for staff to develop new strategies to achieve goals.
Finally, a word of caution for leaders and managers — don't overdo it. Some research indicates that when managers themselves have exceedingly difficult goals, the resulting stress can lead to abusive managerial behavior.