What is Goal–Setting Theory?

Goal-setting theory refers to the effects of setting goals on subsequent performance. In

the 1960s, researcher Edwin Locke found that individuals who set specific, difficult
goals performed better than those who set general, easy goals. Locke proposed four
basic principles of goal-setting: goal difficulty, goal specificity, goal acceptance, and
goal commitment.

Goal Difficulty
Goals are proven to be an effective motivation tactic if difficulty is taken into
consideration. They should be set high enough to encourage high performance but
low enough to be attainable (PSU WC, 2015). When this grey area is achieved, goals
are proven to be effective. If goals are set too high or too difficult than motivation and
commitment suffers as a result. Integrity is another cost that can ensue from setting high
performance goals. A study performed by Ordonez and Schweitzer (2004) reveals
that people have a tendency to be dishonest if they fall short of their goals. Enron’s
book cooking, Ford’s combustible Pinto in the 1960s, and Sears, Roebuck and Co.’s
dishonourable business practices are all examples of highly publicized scandals that
occurred as a result of setting goals too difficult to achieve. In the case of Enron,
executives schemed an elaborate cover-up to hide its bankruptcy from stockholders,
many of whom were employees of Enron and had their retirements invested in the
company. Ford’s goal to gain relevance in the foreign economy car market compelled
the company to cut corners to meet product deadlines and release the Pinto, which
resulted 53 consumer deaths. Mechanics at Sears, Roebuck and Co. engaged in unfair
business practices by overcharging customers and performing unneeded repairs in order
to meet sales goals. Here you can see that setting goals that are too high not only
jeopardizes motivation and commitment but also can create a culture of
corruption, dishonesty, and cutting corners (Bennett, 2009).
The cost of integrity for difficult goal standards can also be illustrated in the illegal, but
commonly practiced, mulligan in the game of golf. A mulligan is an extra stroke
allowed after a bad shot, which is not recorded on the scorecard. This practice is highly
illegal in competitive settings though common in more relaxed games among
friends. The game of golf requires a tremendous amount of skill and concentration,
which can prove to be quite daunting through eighteen holes. To speed the game up and
appease frustration it is common for amateur players to shave shots off the scorecard.

(Figure1 Relationship Between Goal Difficulty and

Performance)
Figure 1 illustrates how goal difficulty effects performance. As you can see the more
challenging the goal, the higher the performance. Performance steadily increases as
goal difficulty increases. The highest level of performance is experienced at "A," the
peak of difficulty. Performance sharply declines if goal difficulty is too high. Easy goals
can easily be achieved therefore there is no incentive to increase performance. Goals
that are too difficult are perceived as unattainable, which will either thwart commitment
(PSU WC, 2015, L. 6) or lead to dishonest behaviours in order to achieve the goal
(Bennett, 2009).
 Goal specificity
A goal must be specific and measurable. It should answer the who, what, when,
where, why, and how of the expectations of the goal. Specificity and measurability
provide an external referent (such as time, space, increment, etc.) to gauge progress,
whereas vague “do better” goals are ambiguous and often have little effect on
motivation. Removing ambiguity allows one to focus on precise actions and
behaviours related to goal achievement. The more specific the goal, the more
explicitly performance will be affected. Specific goals lead to higher task
performance by employees than do vague or abstract goals (Locke & Latham, 2002).
A person can set a general goal to sell more cars per month; however, setting a goal to
sell two cars per day for the next thirty days is more specific and therefore more
effective. These goals will be more motivating than the broad goals of just doing
better. With a clear objective in mind people will be more dedicated to reaching their
set goal (PSU WC, 2015, L. 6) Goals without an external referent allow for a wide
range of acceptable performance levels (Locke & Latham, 2002). In order for
performance to increase, goals must be challenging, specific, and concrete.
Goal specificity does not insure performance at an exceptional level. Specific goals
vary in difficulty. The performance of these goals will also depend on the intellect and
abilities of each individual. Just because a goal is specific, does not guarantee that an
individual will put forth an increased effort to obtain the goal. Management may
implement policies that require workers to sell two cars per day. If this is below the
actual performance that is normal for an individual, that person may not exert any extra
effort to obtain or exceed that goal because the goal required is not difficult to achieve.
In fact, the individual may lower the performance to remain consistent with other
employees. Motivation also plays an important role in goal specificity. The individual
must be motivated to obtain the projected goal, or in other words the goal must have
a level of importance to that individual in order for them to seek to reach it. If a career
selling cars comes secondary to going to school, the individual may not expend the
required effort to reach set goals but instead only perform at a level that they view as
satisfactory.

Goals should be...

Conceivable One should conceptualize the goal so that it is understood clearly

Believable One should believe that the goal can be reached and that other
people believe in it

Achievable One should ask themselves if given their strengths and

weaknesses they can reach their desired goal (Locke & Latham,
2002).
Goal Commitment
Goal commitment is a long-standing variable in the literature on organizational
behaviour and motivation. A central postulate in goal-setting theory is that specific,
difficult-but-attainable goals improve performance (Locke et al. 1981; Locke and
Latham 1990); however, this is only true if individuals are committed to achieving these
goals. From the outset, goal-setting theory recognized goal commitment as a key
mediating variable in the relationship between setting objectives and performance
(Locke 1968), before going on to specifically examine its role (Locke et al. 1988;
Hollenbeck et al. 1989).

Previous studies have suggested several definitions and measures for goal commitment.
Goal commitment is generally defined as an individual’s determination to extend effort
towards a goal over time in order to achieve it (Locke et al. 1981; Locke and Latham
1990).

Klein et al. (2012) recently developed a clarified and generalized concept of

commitment, which can be applied to any type of commitment. According to these
authors, commitment is a “volitional psychological bond reflecting dedication to and
responsibility for a particular target” (p. 137). This definition of commitment can be
applied to any target within the workplace: the target may be the organization, leading
to the notion of organizational commitment, or a specific objective leading to the
concept of goal commitment, which is the focus of our study. The definition put forward
by Klein et al. (2012) is consistent with the above-mentioned definitions. It
encompasses the notion of effort deployed and maintained over time to achieve the
objective, and takes into account every type of objective, whether it is imposed, self-
defined, or negotiated.
Based on this definition and on the literature, Klein et al. (2012) build a model
describing the effects and the determinants of commitment. The latter include
characteristics of the individual involved and of the target, as well as a number of
interpersonal, social, and organizational factors, such as human resources practices.
Klein et al. (2012) do not specifically mention control systems, although the literature
has repeatedly demonstrated that these systems influence attitudes and behaviour, such
as job satisfaction or job-related tension. One can therefore infer that control systems
also influence goal commitment, even if relatively few studies have empirically
examined this relationship.

In addition, according to the Klein et al. (2012) model, these antecedents will influence
the way in which an individual perceives the objective and his or her commitment. This
model suggests that commitment will be stronger if the objective is salient, viewed
positively, perceived as attainable, and if it exists in an environment of trust. This last
aspect is the focus of our study.

The literature on goal commitment addresses all types of individual. In this paper, we
will focus on managers and on their commitment to objectives, which are often set by
results-based control systems.
Goal acceptance
Before a goal can be motivating to an individual, one must accept the goal. Accepting
a goal is the first step in creating motivation (Locke & Latham, 2002). Goal
commitment is the degree of determination one uses to achieve an accepted goal. Two
primary factors that help to enhance goal commitment are importance and self-efficacy
(Locke & Latham, 2002). Importance refers to the factors that make attaining a goal
important, including the expected outcomes (Locke & Latham, 2002). Self-efficacy is
the belief that one can attain their goal (Locke & Latham, 2002). These factors can be
as simple as making a public announcement about the commitment, or as complicated
as a formal program of inspirational mentoring and leadership.

Importance and self-efficacy enhance the goal commitment by the individual (Locke &
Latham, 2006). The individual must find the goal important and must believe they can
achieve it (Locke & Latham, 2006). Making the importance of the goal personal
provides the individual with the motivation to move beyond failure and maintain the
path toward the goal. Research by Erez, Earley, and Hulin (1985) indicates that
participation in setting one’s own goals result in a higher rate of acceptance due to the
individual feeling a sense of control over the goal setting process (Erez, Earley, & Hulin,
1985). Locke and Latham determined that when the purpose or rationale of the goal is
provided, performance between participative and assigned goals do not differ
significantly, as long as the goal is accepted (Locke & Latham, 2002). Their explanation
for the discrepancy lies in the way the goal was presented. If the objectives were clearly
explained to the participants, motivation increased. Alternatively, if goals were briefly
administered with little explanation, motivation was lower. In other words, the goals
need to be specific, which leads us to our next condition.

https://courses.lumenlearning.com/wm-principlesofmanagement/chapter/reading-
goal-setting-theory/
https://www.cairn-int.info/article-E_CCA_203_0043--motivating-managers-goal-
commitment.htm
https://wikispaces.psu.edu/display/PSYCH484/6.+Goal+Setting+Theory