Every year at this time of year, we think about our goals, either for ourselves individually for the year ahead or for the team/unit/business which we manage.
In the workplace, this is usually part of the Performance Management process and is called different things in different organisations – Management by Objectives in Intel, OKR’s (Objectives and Key Results) in Google, performance reviews, SMART objectives, performance assessments, performance appraisals, and so on.
The very best organisations worldwide place significant value on this process and have managers and employees spend significant amounts of time on the process at this time of year, and, in great companies, throughout the year, as it is not just a once in a year event.
Goal-Setting
A significant part of the process is goal setting – setting out audacious goals for the year/period ahead.
Goal-setting theory is based on the premise that people are motivated to achieve the successful attainment of challenging goals.
Studies by Locke in 1968 showed that:
1. More difficult goals result in higher levels of attainment than easy goals, and
2. Specific goals produce higher levels of performance than do general goals (“do your best”)
Various studies showed that “do your best” type goals consistently produced lower performance levels than specific goals, even when the specific goals were difficult.
However, an important point here is that the various studies showed that if a goal is set for someone, even if it is fully agreed with him/her, it has to be clearly translated into tasks and understood by the person to make it effective.
Incentives
In setting goals, people are acknowledging there is something to be gained on successful completion.
Locke identified six incentives:
1. Money
2. Knowledge of score (feedback)
3. Time limits (deadlines)
4. Participation in goal-setting
5. Competition
6. Praise or reproof
He showed that self-generated feedback, by which people can keep track of their own progress, is a more effective motivator than feedback given externally (by the boss).
Motivation to beat a defined benchmark is a key driver for many people and organisations. At an individual level, people are likely to choose benchmarks that are meaningful to them.
Competition is a powerful motivator. If mile runners only ran against themselves or a stopwatch, the 4-minute mile might never have been broken.
Lessons for Leaders
One of the most efficient ways of getting somebody to do something is assign him/her a goal or task, assuming they have the ability to do it. Thus, spending time on regular goal-setting, say quarterly, and reviewing progress against goals is a valuable investment by any manager.