Much has been written about the importance of goals to organizational and individual success. The purpose of this section is not to supplant or to recreate what already exists. One of the most successfully used goal-setting methodologies, Management By Objectives (MBO), was popularized by Peter Drucker in 1954. We refer the interested reader to his book, The Practice of Management, for an MBO primer.
More relevant here, though, is the role of goals in employee engagement, and the importance of engagement to retention. It is this topic to which we now turn.
The Research Evidence
Edwin Locke and Gary Latham are considered the pioneers in the study of goal setting and motivation. We highly recommend their seminal book entitled Goal Setting: A Motivational Technique that Works.
Although originally written as a theory of motivation, goal setting done right has since been shown to not only increase employee motivation but also to increase employees’ sense of well-being, and to provide employees with a sense of direction and focus. In turn, each of these is related to reductions in employee turnover through engagement. Goal setting done right has been shown to reduce absenteeism (often seen as a lesser version of withdrawal than turnover and hence a proxy measure of likelihood to turnover).
The theory of goal setting has been corroborated by dozens of independent studies across a cumulative 40,000+ subjects across several nations and across several occupational fields.
Getting Started with Specific and Challenging Goals
Much of the research on setting goals can be boiled down to five steps in setting goals and six characteristics of well-written goals.
The five steps in good goal writing offered by Robbins and Coulter are: (1) Review the organization’s mission, or purpose. It is important to be sure that employees are working toward goals that advance the goals of the organization as a whole. (2) Evaluate available resources. Rather than motivating employees, setting and having goals that cannot be met with the given resources can be a huge demotivator. (3) Determine the goals individually or with input from others. If the culture of the organization permits, it is always better to receive input from employees on their own goals. Sometimes, though, the culture or needs of the organization lend themselves more toward goal setting from above. (4) Write down the goals and communicate them to all who need to know. This serves two purposes. First, it creates a sense of accountability to the stakeholders who are aware of and affected by the goals. Second, it serves as a constant reminder that employees can refer back to regarding what it is they are actually trying to accomplish on a daily basis. (5) Review results and whether goals are being met, and provide continuous feedback to help employees monitor where they stand regarding their goals. This helps make sure that things are staying on track and allows for revision of goals upward or downward as necessary. We would also add that some research suggests strict goal setting may work better in more highly routinized work settings.
Along with the five steps to goal setting, Robbins and Coulter also offer the following six characteristics of well-written goals: (1) Written in terms of outcome rather than action — it is important to make sure that employees are motivated and rewarded by outcomes more than by activity. (2) Measurable and quantifiable — this characteristic of a well-written goal makes for a specific target to shoot for, makes the determination of goal accomplishment an objective rather than subjective judgment, and provides a specific benchmark for the fair distribution of rewards as discussed previously. (3) Clear as to a time frame—this ensures that goals are being accomplished in a timely manner that is relevant to the time requirements of the organization. (4) Challenging yet attainable — on one hand employees need to be challenged to sustain a high level of engagement, at the same time though, it is important for employees to believe that they can rise to the challenge given the support and resources provided by the organization. Substantial research shows that setting specific challenging goals is more effective than goals that emphasize “doing your best.” (5) Written down and (6) communicated to all necessary organizational members — again these serve two purposes. First, they create a sense of accountability to the stakeholders who are aware of, and affected by the goals. Second, they serve as constant reminders that employees can refer back to regarding what it is they are actually trying to accomplish on a daily basis.
In Summary, Well Crafted Goals Are:
• time bound,
• written, and communicated.
1. Allen, Bryant, and Vardaman (2010)
2. Drucker (1954).
3. Locke and Latham (1984).
4. Latham and Locke (2006).
5. Latham and Locke (1979).
6. Locke (2000).
7. Robbins and Coulter (2009).
8. Locke and Latham (1990).
9. Hackman and Oldham (1975)
10. Hackman, Oldham, Janson, and Purdy (1975).
11. Hackman and Oldham (1976);
12. Oldham, Hackman, and Pearce (1976).
© 2012, Business Expert Press