On setting achievable and realistic goals in business

Goal setting involves the development of an action plan designed in order to motivate and guide a person or group towards a goal, according to Anthony M. Grant in his article titled “An integrated model of goal-focused coaching: an evidence-based framework for teaching and practice”. Goals are planned and deliberate desires. Setting goals means a person or a group has committed thought, plan, checklist, emotion and behaviour towards attaining a target or set of aims. In doing so, the goal setters have established a desired future state which differs from their current state thus creating a mismatch which in turn spurs future actions. Goal setting can be guided by goal-setting criteria (or rules) such as SMART criteria, STA rule, Gantt chart, work plan, strategic plan, master plan or blueprint. Goal setting is a major component of personal-development and management growth strategy. Studies of goal setting (methods, challenges and benefits) by Edwin A. Locke and his colleagues, most notably, Gary Latham have shown that more specific and ambitious goals lead to better performance and improvement than easy or general goals.

Ambitious goals should be set ideally to achieve excellent or near excellent performance, assuming that motivation and not ability is limiting attainment of that level of performance. As long as the person or group accepts the goal, has the ability to attain it, and does not have conflicting goals, there is a positive linear relationship between the goal’s challenges and task performance. The theory of Edwin A. Locke and colleagues states that the simplest, most direct explanation of why some people perform better than others is because they set ambitious, lofty and ‘poles-apart’ performance goals. The essence of the theory is: (1) Ambitious and more specific goals lead to significantly higher performance than simple goals, no goals, or even setting of an abstract goal such as just motivating people to do their best, (2) Holding ability constant, and given that there is buy-in of all to goal commitment, the higher the ‘achievable’ goal, the higher the performance, (3) Variables such as reward and award, feedback, or the participation of people in goal-setting influence behaviour to the extent that they lead to the subsequent commitment to a specific ambitious goal.

Since goals have been realised as the motive for actions, goal setting theory has been developed both practically and experimentally. Cecil Alec Mace carried out the first empirical studies on goal-setting in 1935. Edwin A. Locke began to examine goal-setting in the mid-1960s and continued researching goal-setting for more than 30 years. His findings included the fact that individuals who set specific, ambitious goals performed better than those who set general, easy-to-achieve and simple goals. Locke derived the idea for goal-setting from Aristotle’s ‘form of causality’ which says there may be multiple causes but ‘teleology’ is the overarching cause of change in any setup. Aristotle speculated that purpose can cause action; thus, Locke began to research the impact of human motivation on goals. Locke developed and refined his goal-setting theory in the 1960s, publishing his first article on the subject, “Toward a Theory of Task Motivation and Incentives”, in 1968. This article established the positive relationship between clearly identified goals and performance.

Olufemi Oyedele’s “Theory of Motivation to Achieve Excellence in Project” stated that the best way to spur ‘positive’ employees to their highest performance level is to state what they are to do (set goal/s), give them the tools to do it and say what they will get as compensation for their goal/s. After controlling for ability, goals that are ambitious and specific tend to increase performance far more than easy goals, no goals or telling people to do their best. It therefore follows that the simplest motivational explanation of why some individuals outperform others is that they have different goals. A goal can be made more specific by quantitative and qualitative means: quantification (that is, making it measurable), such as by achieving “increase productivity by 40%” instead of “increase productivity” or “producing 20 tonnes of rice from 10 tonnes produced last year” instead of “producing more tonnes of rice than 10 tonnes”, enumeration, such as by defining tasks that must be completed to achieve the goal instead of only defining the goal.

SMART method of setting goals is the most popular in business while Gantt Chart is the most popular in engineering projects. In the public sector, ‘work plan’ is used, while STA (Specific, Time-bound and Ambitious) is used for personal goal setting. When businesses are setting goals as an organisational strategy, they make them (1) Specific: The goal must be clearly defined and identified. No performance can be achieved without identification and definition, (2) Measurable: The goal must be able to be qualified or quantified. It must be standardised or calibrated, There must be a benchmark to measure its level of performance or achievement, (3) Achievable: Goal setters must set realistic goals that are achievable. Every team member must understand the goals, have buy-in and sign off on the goals, that is, must be committed to achieving the goals, (4) Relevant: The goal should align or conform to other business objectives of the business, and (5) Time-bound: The goal must have threshold, that is, it must have a beginning and an end.

Setting goals can affect outcomes in four ways: (1) Choice: Goals may narrow someone’s attention and direct their efforts toward goal-relevant activities and away from goal-irrelevant actions. (2) Effort: Goals may make someone more effortful. For example, if someone usually produces 4 widgets per hour but wants to produce 6 widgets per hour, then they may work harder to produce more widgets than without that goal. (3) Persistence: Goals may make someone more willing to work through setbacks. (4) Cognition: Goals may cause someone to develop and change their behaviour. People perform better when they are committed to achieving certain goals. Through an understanding of the effect of goal setting on individual performance, organisations are able to use goal setting to benefit organisational performance.

In addition, another aspect that goes with goal commitment is also goal acceptance. This is an individual’s willingness to pursue their specific goal. There are three moderators that affect goal setting success: (1) The importance of the expected outcomes of goal attainment; (2) Self-efficacy: one’s belief that they are able to achieve their goals, (3) Commitment to others: promises or engagements to others which is called ‘assist’ in teamwork, can strongly improve commitment. The level of commitment can be influenced by external factors such as the person assigning the goal, setting the standard for the task performer to achieve/perform.

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