Setting Goals that Work

By Toni Cascio, Ph.D.

In September 1970, Mick Jagger was on the cover of Rolling Stone. The first Monday Night Football game saw the Cleveland Browns defeat the New York Jets. The Mary Tyler Moore Show premiered on television. And debuting in showrooms across America was the tinderbox on wheels, otherwise known as the Ford Pinto. (i)

Do you remember the Pinto? As a car designed to compete with the sudden influx of Japanese and German imports, it had all the right specs. It was small, economical and popular with American consumers. There was only one hitch: due to the positioning of the gas tank, it had a tendency to burst into flames when rear-ended. (ii)

Among the company's expectations set out for the Pinto was that it cost less than $2000. Although Ford knew that a $1 part would solve the problem with the gas tank, they opted not to include it because doing so would cause the company to go over its stated budget goal. (iii)

This debacle is one of several examples of how setting goals can be a counterproductive business measure found in the recent article from the Harvard Business School, "Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting."

The premise of this much blogged- and twittered-about article is that excessive goal setting leads to many negative business practices, such as poor decision-making, unethical behavior, damaging levels of competition among employees and even decreased motivation. (iv)

This opinion runs counter to conventional wisdom that says goal setting is a necessary component of productivity. Studies have shown that setting goals helps people achieve more, improves self-confidence and reduces stress. (v) S.M.A.R.T. goals – which stand for specific, measurable, attainable, relevant and time-bound – have been demonstrated to increase motivation and performance. (vi) As Brian Tracy, guru of goal setting, says, "Success is goals and all else is commentary." (vii)

So who's right? The answer is: both camps. The Harvard study does present some compelling evidence that unrealistic and poorly formed goals can do more harm than good. However, we don't need to throw the baby out with the bathwater. This study can be a wake-up call to help us form better, more useful goals. Here are a few ways to go about this:

1. Be Specific, But Not Rigid
Although the authors of the Harvard study state that, in certain circumstances, the admonition to "do your best" is more effective than setting out specifics, vagueness of goals is not helpful. You need to make sure that both parties have shared definitions of what "doing your best" looks like, realizing that you may need to negotiate what goes into this definition.

2. Goal Setting Must Be Individualized
Goals aren't going to be effective unless they have meaning to the person setting them. One size does not fit all. Not everyone can achieve a certain level of sales or performance. Goals need to take into account people's abilities.

3. Take Organizational Culture and Ethics into Consideration
From the outset, you should consider the impact that goals will have on the organizational culture as well as the ethical implications of your decisions. If certain goals are going to cause cutthroat competition or dishonesty in reporting, they're not good goals. If your desired product is going to kill off all sea life in the northern hemisphere, you should probably rethink it.

4. Be Willing to Revise
Goals set in businesses are not the Gettysburg Address; they're not priceless literature such that altering them will be a great loss to humanity. If your goals are inappropriate in some way – too high or too low, not addressing the aspects of employee performance you're concerned with, too narrowly focused, etc. – change them. .

Goals should be a guide, a tool that enhances performance and motivates people to do their best. If they're not serving this purpose in your organization, it's time to take a second look.

References:

(i) http://www.historyorb.com/date/1970/september
(ii) http://www.time.com/time/specials/2007/article/0,28804,1658545_1658498_1657866,00.html
(iii) http://www.motherjones.com/politics/1977/09/pinto-madness
(iv) http://www.hbs.edu/research/pdf/09-083.pdf
(v) http://www.unhcc.unh.edu/resources/goal-setting.html
(vi) http://www.mindtools.com/pages/article/newHTE_87.htm
(vii) Tracy, B. (2003). Goals! San Francisco: Berrett-Koehler Publishers Inc.

Copyright © Bon Mot Communications LLC 2009

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