PerformanceManagement 1

PracticalApplicationsofGoalSettingTheorytoPerformanceManagement1
PeterA.Heslin,JayB.Carson,&DonVandewalle
CoxSchoolofBusiness
SouthernMethodistUniversity

Performancemanagementinvolvesalltheinitiativeswherebymanagersstrivetoguide
andmotivatehighperformancebyemployees.Suchinitiativeshavetraditionallyfocusedon
providingformalperformanceappraisals,rewardsandrecognitionforhighperformance,aswell
astakingremedialactiontoaddressperformancedeficiencies.Performancemanagementcan
alsofacilitateadaptabilityandcontinuallyimprovingperformanceinrapidlychanging
contemporaryworkplaces.Todoso,however,traditionalperiodicperformanceappraisal
initiativesneedtobesupplementedbyongoingperformancecoaching(London,2003).
Akeyingredientforeffectivelycoachingemployeesistheprudentuseofgoalsetting.
Theprimeaxiomofgoalsettingtheoryisthatspecific,difficultgoalsleadtohigherperformance
than whenpeoplestrivetosimplydotheirbest(Locke,1966,Locke&Latham,1990).The
performancebenefitsofchallenging,specificgoalshavebeendemonstratedinhundredsof
laboratoryandfieldstudies(Locke&Latham,1990,2002). Suchgoalspositivelyaffectthe
performanceofindividuals(Baum&Locke,2004),groups(OLearyKelly,Martocchio,&
Frink,1994),organizationalunits(Rogers&Hunter,1991),aswellasentireorganizations
(Baum,Locke,&Smith,2001) andoverperiodsaslongas25years(Howard&Bray,1988
Locke&Latham,2002).
Byprovidingdirectionandastandardagainstwhichprogresscanbemonitored,
challenginggoalscanenablepeopletoguideandrefinetheirperformance.Itiswelldocumented
inthescholarly(Locke&Latham,2002)andpractitioner(Latham,2004)literaturesthatspecific
goalscanboostmotivationandperformancebyleadingpeopletofocus theirattentiononspecific
objectives(Locke&Bryant,1969),increasetheireffort toachievetheseobjectives(Bandura&
Cervone,1983),persistinthefaceofsetbacks(Latham&Locke,1975),anddevelopnew
strategiestobetterdealwithcomplexchallengestogoalattainment(Wood&Locke,1990).
Throughsuchmotivationalprocesses,challenginggoalsoftenleadtovaluablerewards
suchasrecognition,promotions,and/orincreasesinincomefromoneswork(Latham&Locke,
2006).Workingtoattainvaluedgoalsrelievesboredombyimbuingworkwithagreatersenseof
purpose.Eventhoughsettinghighgoalssetsthebarhighertoobtainselfsatisfaction,attaining
goalscreatesaheightenedsenseofefficacy(personaleffectiveness),selfsatisfaction,positive
affect,andsenseofwellbeingespeciallywhenthegoalsconqueredwereconsidered
challenging(Wiese&Freund,2005).Byprovidingselfsatisfaction,achievinggoalsoftenalso
increasesorganizationalcommitment(Tziner&Latham,1989),whichinturnpositivelyaffects
organizationalcitizenshipbehavior(Organ,Podsakoff,&Mackenzie,2006),negativelyaffects
turnover(Wagner,2007),andincreasesthestrengthoftherelationshipbetweendifficultgoals
andperformance(Locke&Latham,1990,2002).
Specificchallenginggoalsdonot,however,necessarilyleadtosuchdesirablepersonal
andorganizationaloutcomes.Rather,theresultsfromgoalsettingdependcriticallyonissues
pertainingtogoalcommitment,taskcomplexity,goalframing,teamgoals,andfeedback.The
purposeofthispaperistodiscussrecentdevelopmentsregardinghowthesefivefactorscanbe
managedtoenableeffectiveperformancemanagement.

ForthcominginJ.W.Smither(Ed.), Performancemanagement:Puttingresearchintopractice. SanFrancisco,CA: Jossey Bass.

Electronic copy available at: http://ssrn.com/abstract=1275115

PerformanceManagement 2
GoalCommitment
Astatisticalreviewof83studiesrevealedthatgoalcommitmentisacriticalingredient
forgoalstoleadtoperformance,especiallywhengoalsaredifficult(Klein,Wesson,Hollenbeck,
&Alge,1999).Astudywithrehabilitationcounselorsatastateagency foundthatfeedbackhada
positiverelationshipwithworkperformanceonlyforthoseindividualswithhighgoal
commitmentithadanegativerelationshipwithperformanceforthosewithlowergoal
commitment(Renn,2003).Thus,thewellvalidated5item scaleforassessinggoalcommitment
developedbyKleinetal.(2001),asoutlinedinTable1,isofpracticalvaluetoorganizational
researchersandpractitionersalike.
Table1. GoalCommitmentScale DevelopedbyKleinetal.(2001)
1.
2.
3.
4.
5.

Itshardtotakethisgoalseriously.(R)
Quitefrankly,IdontcareifIachievethisgoalornot.(R)
Iamstronglycommittedtopursuingthisgoal.
Itwouldnttakemuchtomakemeabandonthisgoal.(R)
Ithinkthisisagoodgoaltoshootfor.

ResponsesareprovidedonafivepointLikertscaleusingstronglydisagreeto
stronglyagreeanchors.
*Note.Itemsfollowedby(R)indicatethattheitemshouldbereversescoredbeforeanalysis.
LockeareLatham(2002)suggestthattwokey categoriesofapproachesforbuildinggoal
commitmentaretoincreasegoalimportance,includingthedesirabilityoftheoutcomespeople
expectfromworkingtoattaintheirgoals,andalsotofosterselfefficacyi.e.,peoplesbeliefthat
theycanattainthegoal.
GoalImportance
Thereareatleastfivewaystoconvincepeoplethatgoalattainmentisworthwhile.These
include(a)elicitingapubliccommitmenttogoals,(b)communicatinganinspiringvision,(c)
usinganempathyboxanalysis(Latham,2001)tounderstandandaltertheperceived
consequencesofgoalcommitment,(d)providingfinancialincentivesforgoalattainment,and(e)
expressingconfidencethatthegoalwillbeachieved.
First,havingpeoplemakeapubliccommitmenttoagoalenhancestheircommitmentto
it,presumablybecauseactingcontrarytotheirpublicpronouncementwouldinducethe
personallyandsociallyundesirableimpressionofhypocrisy(Cialdini,2001Festinger,1957).In
thelate1990swhen PepsiCospunoffofitsRestaurantDivision(PizzaHut,TacoBellandKFC)
tocreateYUM!Brands, theYUM!leadershipsoughttoelicitcommitmenttothepromulgated
FoundingTruthsregardingtheintendedmoredecentralizedandrestaurantcenteredcultureof
thenewlyformedorganization.Whileexitingtheofficiallaunch celebration of YUM!,restaurant
generalmanagers(RGMs)wereinvitedtosigntheirnamesonaposteroftheFoundingTruths
andtobecomeafounder,butonlyiftheyagreedwiththeprinciplesofthenewcompany.
Althoughitwasemphasizedthatsigningwasstrictlyvoluntaryandtherewouldbenoimplicit
penaltyfornotsigning,over80percentoftheattendingRGMslefttheirsignatures,thereby
makingapubliccommitmenttothenewcompanysespousedculturalvalues.FoundersDay
asitisnowcalled,hasbecomeayearlyeventcelebratingthecultureof YUM! andoften

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PerformanceManagement 3
featuressignatoriesbeingphotographedinfrontofthepostertheyhavejustpubliclysigned
(Mike&Slocum,2003).
Second,goalcommitmentcanbebuiltbyleaderscommunicatinganinspiringvision or
superordinategoal forfollowerstorallyaround.Aneffectivevisioncreatesexcitementand
energyinemployees,isconsistentwiththevalues,objectives,andstrategicadvantagesofthe
organization,andfacilitatesunifiedactionconsistentwiththevision.Aclassicexampleofsucha
visionisWinstonChurchills(1940)proclamationthatdespiteBritainbeingundergravethreat
from moreapowerfuladvancingNazimilitary:
Ihave,myself, fullconfidencethatifalldotheirduty,ifnothingisneglectedwe
shalloutlivethemenaceoftyranny,ifnecessaryforyears,ifnecessaryalone
Whateverthecostmaybe,weshallfightonthebeaches,weshallfightonthe
landinggrounds,weshallfightinthefieldsandinthestreets,weshallfightinthe
hillsweshallneversurrender
Otherexamplesofcompellingvisionsthathavebuiltstrongcommitmenttomacrolevelgoals
includeMartinLutherKingsIhaveadreamspeech,JohnF.Kennedysinauguraladdressin
whichheurgedAmericansto:Asknotwhatyourcountrycandoforyou,butwhatyoucando
foryourcountryandhis1961visiontoputamanonthemoon beforetheendofthedecade,
WaltDisneysmottooffosteringlearningthroughentertainment,andJackWelchsdecreethat
GeneralElectricwastobecomeaboundarylessorganizationandtobeeitherNo.1orNo.2in
anyindustrywheretheycompete(Latham,2003). BarackObamasvisionofamoreunitedand
egalitarianUS,encapsulatedinstatementssuchas:Whatbindsustogetherisgreaterthanwhat
drivesusapart(Obama,2006,p.2),and"ThereisnotablackAmericaandawhiteAmericaand
LatinoAmericaandAsianAmericathere'stheUnitedStatesofAmerica"(Obama,2004),
attractedarecordbreakingnumberofdonationsinsupport ofhisgoaltobecometheDemocratic
nomineeforthe2008USPresidentialelection.Inspiringvisionsandsuperordinategoalsarenot
limitedtonationsorevenorganizations,butmayalsobeusefultomanagersatthedepartmentor
teamlevels.Forinstance,agroupofdemoralizedhospitaljanitorsbecameinvigoratedbytheir
teamsvisionofmakingtheirhospitalasafeandpleasantenvironmentforallhospitalpatients,
staff,andvisitors.
Third,an empathyboxanalysis(Latham,2001,2003)isbasedontwounderlying
premises:(a)understandtheanticipatedconsequencesandyouwillunderstandpeoples
behavior,and(b)changetheanticipatedconsequencesandyouwillchangepeoplesbehavior.
Asunderscoredbyreinforcementtheory(Luthans&Stajkovic,1999),employeesareonlylikely
tocommittoagoalwhentheyperceivethatdoingsoisinsomewayintheirbestinterests.For
instance,seniormanagementatWeyerhaeuserForestProductswashavingtroubleobtaining
employeecommitmenttoacompanygoaltoreduceshrinkage(i.e.,theftbyemployees)from
approximately$1million peryeartolessthan$1000peryear.Tohelpmanagersidentify the
outcomesthatemployeesexpectedasaresultof committingtoorrejectingthegoalofhonest
behavior,Latham(2001,2003)developedandappliedtheconceptofanempathyboxanalysis.
Basedonthefirstpremise(a)outlinedabove,theprocedureinvolvedfirstaskingarandom
sampleofemployees,whichpresumablyincludedsomeofthethieves,variantsofthefollowing
fourquestions2:
1. Whataretheupsidesforyouofbeinghonest?
2. Howmightyousufferfrombeinghonest?
2

Grantedthat inthisscenario,honestywasthedesiredbehavior(DB)andtheft/stealingwastheundesiredbehavior
(UB),thefollowingquestionsrepresentaspecificapplicationofthefirstfourstepsinthegeneralempathybox
protocolpresented inFigure1.

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PerformanceManagement 4
3. Whatpositiveoutcomescouldyoupersonallyexpectfromstealing?
4. Whatnegativeoutcomesmightyouexpectfromengagingintheft?
Figure1.EmpathyBoxAnalysisProtocol*
Consquences
Positive

Negative

KeyQuestions
1. PositiveconsequencesofDB?

Cell1

Cell2

DesiredBehavior(DB)

2. NegativeconsequencesofDB
3. PositiveconsequencesofUB?

UndesiredBehavior(UB)

Cell3

Cell4

4. NegativeconsequencesofUB
5. Whatconsequencescanbechanged?

*Note: AdaptedfromLatham(2001,2003)
Inresponsetoquestion1,Lathamdiscoveredthatasidefrompersonalprideinones
integrity,nopositiveconsequenceswereperceivedforhonestbehavior(DB). Regarding
question2,employees(andsupervisors)hadexperiencedsubstantialpeerpressureand
harassmenttonotrocktheboatbyreportingtheft(DB).Pertainingtoquestion3aboutthe
perceivedbenefitsofstealing,thethievesdidnotseemtobesellingthestolengoodsorseeking
revengeagainstthecompany.However,someemployeesrelishedthechallenge,thrill,and
excitementofstealing,aswellastakingprideintheirproficiencyatdoingso(UB).Finally,
owingtoarelativelytightlabormarket,powerfulunion,andfirmexportcontractswithJapan,
therewaslittleconcernaboutbeingfiredifcaughtstealing(UB).Thebiggestproblemcreatedby
thetheftwaswivescomplainingaboutclutteredgarages!Insummary,themostpotent
anticipatedconsequenceswerenegativefortheDBofbeinghonestandpositivefortheUBof
stealing.
IncontrasttotheusualfocusonrewardingDBsandpunishingUBs,asystematic
empathyboxanalysisoftenrevealscreativealternativesforansweringQuestion5:Howcanthe
incentivestructurebechangedtoincreasecommitmenttotheDB?AtWeyerhaeuser,anamnesty
daywasdeclaredduringwhichanyonecouldreturnanystolenequipmentunderthepresumption
thattheywerejustdoingsoforafriend.Thisremovedthenegativeconsequenceforbeing
honest.Inaddition,alibrarysystemwasimplementedwherebyanyemployeecouldborrow
companyequipment,aslongastheycheckeditoutandsignedawaiverindemnifyingthe
companyagainstanyinjuriesresultingfromuseoftheborrowedequipment.Thisdefusedthe
thrillofstealing.Theoverallresultofthesevirtuallycostlessinitiativestochangetheincentive
structurepertainingtohonestbehavior,asperceivedbyemployees,wasthereturnofmassive
amountsofvaluableequipmentandasubstantialdecreaseinsubsequenttheft(Latham,2001,
2003).
Fourth,monetaryincentivescanincreasetheimportancepeopleattachedtogoals.
However,thisapproachtobuildinggoalcommitmentcanbeproblematic,bypotentially
discouragingrisktakingandcreativity,rupturingrelationships,andencouragingshorttermism
(Kohn,1993).Fortunately,Locke(2004)providesahighlyusefuldiscussionregardingthe
nature,pros,andconsoffivedifferentmethodsofmakingfinancialincentivescontingentupon

PerformanceManagement 5
levelsofperformanceandgoalattainment.Thisdiscussioncanbeusedtomakeconscioustrade
offsaboutthemostsuitableincentivesystemtouseifany(Kohn,1993)inagivenwork
context.
Fifth,managerscanbuildtheperceivedvalueofgoalattainmentbysupportively
expressingconfidence thatthethegoalcanandwillbeachieved(Latham,2004,p.127).
Thisapproachprobablyfostersgoalcommitmentbyincreasingemployeesselfefficacy,as
discussednext.
SelfEfficacy
Itiswellestablishedthatgoalcommitmentispredictedbyapersonslevelofself
efficacy(Wofford,Goodwin,&Premack,1992),i.e.,levelofbeliefinhisorhercapabilityto
successfullyperformaparticulartask(Bandura,1986).Therearethreekeysourcesofself
efficacy.Themostpotentisenactiveselfmastery,followedby rolemodeling,andthen verbal
persuasion.
Enactiveselfmastery occurswhenpeopleexperiencesuccessatperformingatleast
portionsofatask.Byimplication,failurescanlowerselfefficacy.Masteryexperiencesare
facilitatedbybreakingdown difficulttasksintosmall,relativelyeasystepsthatprogressively
becomemoredifficult.Togetherwithadequatefeedbackandresources(e.g.,equipmentand
information)toperformeffectively,suchaprocesstendstoenablethehighrateofinitial
successesthatformsafirmbasisforhighselfefficacy.Rememberingtoacknowledgeandvalue
evenminorperformanceimprovementsandintermediaryachievementsisalsoimportantfor
buildingselfefficacythroughenactiveselfmastery(Bandura,1986,1997).
Rolemodelinghappenswhen aperson wantingtolearnataskobservesandidentifies
withanotherpersonsproficientperformanceonthattask. Rolemodelscaninspireconfidence
thatthoseobservingthemcanactinasimilarlysuccessfulmanner.Modelsaremosteffectiveat
raisingselfefficacywhentheyarepersonallylikedandareperceivedashavingattributes(e.g.,
age,gender, talent, andethnicity)similartotheindividualswhoobservethem.Animportant
implicationisthatmanagersshouldthinkcarefullybeforeassigningmentors,especiallywithout
theinputofthosebeingmentored(Ragins,Cotton,&Miller,2000).Individualsmaylearnand
becomemoreconfidentfromobservingboththesuccessesandfailuresofothers,aslongasthey
feelconfidentthattheycanavoidrepeatingtheerrorstheyobserve(Bandura,1986,1997).
Verbalpersuasionincreasesselfefficacywhenindividualsareencouraged,bypeople
theyrespect,regardingtheircapacitytolearnandperformeffectively(Bandura,1986).Positive
selftalkcanalsoraiseselfefficacy(Latham&Budworth,2006).Efficacyraisingfeedback
highlightshowconsistenteffortshaveenabledsubstantialimprovements,aswellastheprogress
made,ratherthaninvolvingpeercomparisonsormakingreferencetohowfarindividualshaveto
gountiltheirultimateobjectiveisachieved.Effectiveverbalpersuasionisreinforcedwith
correspondingactions.Forexample,tellingindividualsthattheyarecapablebutnotassigning
themanychallengingtaskstendstoerodebothemployeesselfefficacyandamanagers
credibility.Incontrast,havingindividualsdrawupaprogresschartbeforecomplimentingthem
ontheirgenuineprogress,whereapplicable,isapotentwayofraisingemployeessenseofwhat
they canachieve(Bandura,1986,1997).Forconcreteguidanceonhowtoapplythesethree
principlesfordevelopingselfefficacy,HeslinandKlehe(2006)providea20item behavioral
selfassessmentoftheextenttowhichmanagersincreasetheselfefficacyof theiremployeesby
providingeffectivemasteryexperiences,rolemodeling,andverbalpersuasion.
Insulatingselfefficacy. Asmentionedearlier,whenperformingchallengingtasks,
setbacksareinevitable.However,suchexperiencesarelesslikelytoweakenselfefficacywhen
peopleholdtheimplicitbeliefthattheirabilitiesare(a)relatively malleableandabletobe
developedincrementally throughpersistenteffortandstrategydevelopment,ratherthan(b)

PerformanceManagement 6
essentially fixedandunlikelytochangemuch overtime,asimpliedbythetraditionalnotionofa
personsIQ(Wood&Bandura,1989).Theselfefficacyprotectingassumptionthatabilitiescan
bedevelopedoriginallylabeledanincrementalimplicittheoryofintelligence(Dweck,1986,
p.1045)andmorerecentlyagrowthmindset(Dweck,2006) canbedevelopedthrough
severalmeans.Theseinclude(a)informingpeoplethattheirskillsaredevelopedthrough
practice,ratherthanreflecttheirbasiccognitivecapabilities(Wood&Bandura,1989,p.410),
(b)havingpeoplereadacompellingscientifictestimonialregardinghowwitheffortandpractice,
abilitiescanbecultivatedthroughoutmostofthelifespan(Chiu,Hong,&Dweck,1997),and(c)
attributingsuccessfulperformancestoaperson havingworkedhard,ratherthanbeingsmart
(Mueller&Dweck,1998).
Heslin,Latham,andVandeWalle(2005)developedanintervention thatenablesmanagers
tocreateasustainedgrowthmindsetamongworkingadults.Heslinetal.randomlyassigned
managerstoparticipatein eitheran incrementalintervention/growthmindsetworkshopbased
onprinciplesofselfpersuasion(Aronson,1999),orinaplacebocontrolworkshop. Oneofthe
fiveactivitiesinthegrowthworkshopinvolvesparticipantsrecallinganareainwhichtheyonce
hadlowability,thoughcannowperformquitewell(e.g.,playinggolf),beforepondering(a)how
theydevelopedtheirskillsinthisarea(e.g.,throughsustainedeffortandcoaching),and(b)why
undertakingsimilardevelopmentalinitiativescouldnotenablethemtoalsocultivateaskillthey
wouldliketodevelop(e.g.,playingthepiano)butassumetheyhavenoinherenttalentto
develop.Sixweekslater,comparedtothoseintheplacebocontrol,participantswhoreceivedthe
incrementalinterventionhadasignificantly greatergrowthmindsetandalsoactedin
theoreticallypredictedways(seealsoHeslin,VandeWalle&Latham,2006).
Insummary,goalcommitmentcanbeincreasedthrough publiccommitments,inspiring
visions,usinganempathyboxanalysistounderstandandchangetheconsequencesthat
employeesanticipate,financialincentives,andexpressingconfidencethatthegoalwillbe
achieved.Goalcommitmentcanalsobebuiltbycultivatingselfefficacythroughapplicationof
theprinciplesofenactiveselfmastery,rolemodeling,andverbalpersuasion(Bandura,1986,
1997),asconcretelyillustratedbyHeslinandKlehes(2006)selfassessmentmeasure.Self
efficacy isinsulatedfromthepotentiallyefficacyloweringeffectsofsetbacksbycultivatinga
growthmindset(Wood&Bandura,1989)usingarangeof techniquesreviewedbyDweck
(1999,2006seealsoHeslin&VandeWalle,2008).
TaskComplexity
Complextasksarethoseonwhichthepathtogoalachievementisnotimmediately
apparentoreasilyunderstood.Wood(1986)definedtaskcomplexityasinvolvingthreeaspects:
componentcomplexity(signifiedbythenumberofactsandinformationcuesinvolvedin
completingatask), coordinativecomplexity(indicatedbythetypeandnumberofrelationships
amongtheactsandinformation cues),anddynamiccomplexity(reflectingthedegreeofchanges
inactsandinformation cuesovertime,aswellastherelationshipsamongthem).Grantedthe
needtodevotetimeandmental efforttounderstandingcomplextasksandmasteringskillsin
ordertocompetentlycompletethem,Wood,Mento,andLocke(1987)investigatedwhethertask
complexityreducesthepositiveeffectofdifficult,specificoutcomegoalsontaskperformance.
Consistentwiththeirhypotheses,Woodetal.smetaanalysisrevealedthatdifficultgoaleffects
onperformancewerestrongest(d =.76)foreasytasks(e.g.,thoseinvolvingreactiontimeand
brainstormingtasks)andweakest(d =.42)formorecomplextasks(e.g.,businessdecision
making,scientificandengineeringwork,andfacultyresearch).
Aprototypicallycomplextaskisperformedbyairtrafficcontrollers.Atanygivenpoint
intime,thereareoftenmanyplanesflyinginanairportsvicinity(componentcomplexity),their
trajectoriesneedtobeconsideredinrelationshiptoeachother(coordinativecomplexity),andthe

PerformanceManagement 7
relationshipsbetweenplanestrajectoriesconstantlychanges(dynamiccomplexity).Kanferand
Ackerman(1989)reasonedthatowingtotheconsiderablecognitivedemandsinvolvedinair
trafficcontrol(ATC),strivingforperformancegoalswhenfirstlearningsuchataskmightcreate
cognitiveoverloadandtherebyslowlearningandlowerinitialperformance.Inanexperimental
studyinvolving568U.S.AirForcerecruitslearninganATCtask,KanferandAckerman
observedthatparticipantsgivenagoalfeltmorepressured,gotmoredistracted,andexhibited
lowerATCperformancethanparticipantsinstructedtojustdotheirbest.Thisresearch
illustratesthatagoaltoattainaspecificoutcomecanimpedetasklearningwhenpresented
priortoanunderstandingofwhatthetaskisabout(Kanfer&Ackerman,1989,p.687).
Subsequentresearchhasestablishedthatgoalsactually canbehelpful even duringthe
earlystagesofcomplexskillacquisition,aslongasthey aretherightkindsofgoals.Twoviable
alternativesareproximalgoalsandlearninggoals,asdescribednext.
First,usingamodestlycomplexbusinessgame,LathamandSeijts(1999)replicated
KanferandAckermans(1989)observationthatparticipantsperformedbetterwithavaguedo
yourbestgoalthanwithaspecificdistal(ultimateoutcome)goal.However,when proximal
(shortterm,intermediate)goalsweresetinadditiontothedistalgoal,selfefficacyandprofits
weresignificantlyhigherthaninthedoyourbestconditionorintheconditionwhereonlya
distalgoalhadbeenset.Feedbackonperformancerelativetoproximalgoalsseemstofacilitate
thedevelopmentofeffectivestrategiesneededtoperformwelloncomplextasks.
Second,peoplefirstlearningacomplextaskcanbegivenalearninggoal tofocustheir
effortondiscoveringstrategiesorproceduresnecessarytoeffectivelyperformatask(Dweck,
1986).ConsistentwithKanferandAckerman's(1989)cognitiveresourceallocationtheory,a
personslimitedattentionisexplicitlydirectedtolearningandmasteringthetaskratherthan
worryingabouttheirperformanceoutcome.WintersandLatham(1996)foundthatwhen
performingarelativelysimpletask,therewerenosignificantdifferencesin performance
betweenthosewithalearninggoalrelativetothoseinstructedtodoyourbest.Peoplewitha
specifichighperformancegoalhadthehighestperformance.Onlywhenthetaskwascomplex
didalearninggoalleadtohigherperformancethanadoyourbestorahighperformancegoal.
Similarly,usingacomplexsimulationthatexaminedentrepreneurialbehaviorinstarting
upandmaintainingabusiness,NoelandLatham(2006)foundthatthosewhousedalearning
goalwereabletokeeptheirsimulatedfirmsrunninglongerthanthosewithaperformance
outcomegoal.Togetherthesefindingssuggestthatlearninggoalsarevaluablewhencomplex
skillsneedtobeacquired.Afterproficiencyhasbeendeveloped,highspecificperformancegoals
shouldbeset(Seijts&Latham,2005).
Tosummarize,novicesatcomplextasksshouldnotbegivenspecific,challenginggoals.
Rather,theyoughttobegiveneitherproximalgoals(e.g.,sell10unitsthismonth,ratherthan
sell120unitsthisyear),orspecificlearninggoals(e.g.,discover5newstrategiesfor
respondingconstructively topotentialcustomerswhodonotinitiallyreactpositivelytoyour
salesinitiatives).
GoalFraming
Goalscanbeframedinseveraldifferenttypesofwaysthataffecthowwell peoplelearn
andperform.Goalscanbeframedeithernegatively(e.g.,Duringthefollowingyear,trynotto
losemorethan5outofyour40currentcustomers)orpositively(e.g.,Duringthefollowing
year,trytokeepatleast35outofyour40currentcustomers).Negativelyframedgoalsleadto
moreanxiety,aswellaslowerpersistenceandperformance,comparedtogoalsthatareframed
positively (Roney,Higgins,&Shah,1995).
UnderJackWelchsleadership,GeneralElectric(GE)waswellknownforits
encouragementofstretchgoalswhichchallengeemployeestoachieveobjectivesthattheydo

PerformanceManagement 8
notyetknowhowtoreach(Kerr& Landauer,2004).GEwasalsorenownedforthethreatening
policyoffiringthebottom10%ofemployeesonannualperformanceratings.Giventhehigh
taskcomplexity,stress,andworkoverloadthatincreasinglycharacterizesmodernworkplaces,
DrachZahavyandErez(2002)investigatedperformancedifferencesdependingonwhether
difficulttasksareframedasachallengeprovidinganopportunityforselfgrowth,orasathreat
regardingwhicheffectivestrategiestodealwithitarenotreadilyavailable.Ashypothesized,
challengeappraisalsyieldedconsistentlybetterperformancethanthreatappraisals.However,
thosewhoviewedthetaskasathreatperformedbetterwhentheyhadlearninggoalsratherthan
performanceoutcomegoals.Finally,difficultperformancegoalsinducedhighadaptationto
changewhentheworkcontextwasperceivedaschallenging,butpooradaptationand
performancewhentheworkcontextwasperceivedasthreatening.
Regardlessofwhetherpeopleadoptadifficultlearningorperformancegoal,errorsare
boundtooccurduringtheprocessofgoalpursuit.Workplaceerrorscanbeextremelycostlyto
careers, organizations,andevenhumanhealth,asillustratedbytheExxonValdezandSpace
ShuttleChallengerdisasters,aswellastheEnronandChernobyl financialandnuclear
meltdowns,respectively.Notsurprisingly,mosttraditionaltrainingprogramsfocuson teaching
participantshowtoavoiderrors.However,fromapsychologicalperspective,errorsalsoprovide
importantinformationthatcan enablelearningandpotentiallyreduceoreliminatefutureerrors.
MichaelFreseandcolleagues(Freseetal.,1991) thusdevelopedtheconceptof error
management,wherebyerrorsencounteredduringthelearningprocessareconstruedas
opportunitiestolearnwhatdoesnotwork.Incontrasttoerrorpreventiontraininginwhicherrors
arepunishedwithlowgrades,error managementtrainingisdesignedtoreducethenegative
emotionaleffectsoferrors.Peoplearetaughttoframeerrorspositivelybypairingnegative
feedbackwithstatementssuchasErrorsareanaturalpartofthelearningprocess!orThe
moreerrorsyoumake,themoreyoulearn!Suchtrainingfacilitateslearningfromcomputer
softwaretraining,asmeasuredbothimmediatelyandoneweekaftertraining(Heimbeck,Frese,
Sonnentag,&Keith,2003),apparentlyasafunctionofreducinganxietyandincreasing
systematicplanning,monitoring,andlearningfromone'sprogressduringtaskcompletion(Keith
&Frese,2005).Giventhedynamicnatureofthetasksperformedbymanymodernday
knowledgeworkers,itisnoteworthythatthesuperiorityof errormanagementtrainingover
traditional erroravoidantmethodsisespecially pronouncedforpromotingtransferoftrainingto
noveltasks(Keith&Frese,2008).
Insummary,goalsaregenerallybestframedpositively ratherthan negatively.Especially
whengoalsarechallenging,itisimportanttohelppeopletoframethemasachallengefrom
whichtheymaylearn,ratherthanathreatregardingwhichfailureisforeseeable.Finally,itis
prudentformanagerstoemphasizethaterrorsalongthepathtogoalattainmentareanaturalpart
ofthelearningprocess.Thiscanreduceemotionaldistractionandpromotethedeeplearning
employeesneedtoeffectivelytacklenovelchallengesastheyarise.
TeamGoals
Theriseofteamworkandteambasedorganizationalformshascreatedashiftinhow
managersunderstandandpracticegoalsetting.Manyofthebasicfundamentalsofindividual
goalsettingcanbetranslatedtogroupsofpeople.Teamgoalsthatarespecificanddifficulthave
consistentlypositiveeffectsonteamperformance(OLearyKelly,Martocchio,& Frink,1994).
Thesedifficultteamgoalsalsoimproveperformancethroughthesamemechanismsofincreased
focus,effort,persistence,anddevelopingnewstrategiesforcomplextasks(Weingart,1992).
Whileteamgoalsfunctioninsimilarwaystoindividualgoals,therearealsoseveralunique
issuesthatmakegoalsettingmorecomplexinteamsettings.

PerformanceManagement 9
When specificdifficultgoalsaresetby ateam,eachteammemberdoesnotnecessarily
personally adopt theteamgoal.Eveniftheydo,conflictscanoccurbetweenpersonalandteam
goals.Inorderforindividualseffortstobedirectedtowardteam performance,the team goal
mustbeadoptedastheirown. Mitchell andSilver(1990)foundthatteamperformancecan
sufferonsimpletaskswhenteammemberspersonalgoalscompetewiththoseofotherteam
members.Cohenandcolleagues(1999)examinedhoworganizationssetandcommunicate
directionforknowledgeworkteams,includingalignmentofgoalsbetweenindividuals,teams,
andtheorganization,aswellashowspecificandmeasurablethegoalswere.Theyfoundthat
goalalignmentaroundorganizationalprioritiesledtohigherteamperformance.
Goal alignmentisakintotheeffectsofayokeonharnessingtheeffortsof ateamof
animalsinthesamedirection,ortheeffectofrailsonaligningthedirectionoftraincars.If
membersofateamhavegoalsthatarepullinginadifferentdirectionthanthegoalsofother
teammembers,thiswill resultindiminishedeffortandperformancebytheteam,aswellas
possiblefrictionorsparks.Inordertoachievebettergoalalignment,electronicperformance
dashboardsarebeingusedinorganizationstofacilitateteamgoal settingandmonitoringofteam
performancerelativetobothteamandorganizationalgoals.Thesesoftwareprogramsenable
userstosetteam goalsthatareconsistentwiththeorganizationsvision,andtotrackinreal
timekeyperformanceindicatorsrelativetogoals,allthewaydowntotheteamor individual
level.Dashboardscanhelpprovidefeedbacktoteamsleadingtoafocusonteamgoalsand
performance(DeShonetal.,2004).
Aprimarywayformanagerstoalignindividualgoalswithteamgoalsistoseek
commitmenttoasuperordinategoal.Whenpeopleperceivethattheattainmentofotherpeoples
goalsmightdecreasetheprobabilityofattainingtheirowngoal,theytendtowithhold
informationandideas,aswellassometimesevenactingtoobstructothersgoalpursuit(Stanne,
Johnson,&Johnson,1999). Inorderformanagerstogetbuyinforteamgoals,theycanuse
manyofthesametechniquesdiscussedpreviouslyinregardtoestablishingtheimportanceofa
specificgoal.Theseincludepubliccommitmentstotheteamand/orothers,aninspiringvision
relatedtoteamgoals,incentives,orconsiderationofperceivedconsequences.Twoadditional
initiativesaredevelopingteamefficacy andenablingparticipationinsettingteamgoals.
Teamefficacy. Teamefficacyreferstoateamsbeliefthatitcansuccessfullyperforma
specifictask(Lindsley,Brass&Thomas,1995). Teamsthathavehighefficacychoosemore
difficultgoals,persistintheirefforts,andseektoimprovetheirtaskstrategies.Inanexperiment
involvingundergraduatestudentsparticipatinginacomputerizedtankbattlesimulation,team
efficacyexplained58%ofthevarianceinteamsetgoaldifficulty,andhadanindirecteffecton
performanceviagoaldifficulty(Durham,Knight,&Locke,1997).Difficultteamgoalscan
increaseteamefficacy,aswellassubsequentstrategicrisktakingandteamperformance
(Knight,Durham,&Locke,2000). Teamefficacyalsoworkstogetherwithgoalalignmentto
increaseteamperformance.Inametaanalysisofstudiesonteamefficacy,Gullyandcolleagues
(2002)foundthatteamsthathadhighlevelsofteamefficacyandhighlevelsofgoalalignment,
alongwithgrouprewards,demonstratedthebestperformance.
Participationinsettingteamgoals. Peoplearemorelikelytocommittodifficultgoals
thatareimportanttothem personally.Participationinthesettingofgoalsimprovesteam
performancebyenhancingtheimportanceofgoalstoeachteammemberandtherebyincreasing
goalcommitment(OLearyKelly,Martocchio,& Frink,1994).However,participationinteam
goalsettingmaynotalwaysbeanoptionformanagers.Latham,Erez,andLocke(1988)found
thatparticipationingoalsettingdoesincreasegoalcommitment,butthatassignedgoalsarealso
effectivesolongasacompellingpurposeorrationaleforthegoalisgiven.Tellingandselling,
ratherthanjusttellingpeoplewhattheirgoalsarehelpsthem tounderstandwhythegoalis
importantand thereforeenhancesgoal commitment.

PerformanceManagement 10
Teamgoalscaninduceproductivecooperation andcompetition.AtWholeFoodsMarket,
thelargestnaturalfoodsgrocerintheUnitedStates,thecultureisbasedalmostentirelyon
teamwork. Eachstorehas810teamswithdesignatedleadersandclearperformancegoals.How
theyreachthosegoalsisuptoeachteam.Teamsaregiventheresponsibilityforalldecisions
aboutlaborspending,ordering,pricing,aswellashiringnewteammembers.Theyarerewarded
asateamwithgainsharingbonusesbasedonteamperformance(profitabilityintheirarea).
Thesehighlevelsof sharedresponsibility forteamprocessesandoutcomesproducehighlevels
ofcooperationwithinteams.Theyalsoproducecompetitionbetweenteams,stores,andeven
regionsintheareasofquality,service,sales,growth,productivity,andprofitability.This
competitionincreasesteamidentityandloyalty,thoughitsintensityneedstobekeptincheckso
asnottoundermineorganizationalidentityandcooperation(Fishman,1996).
Finally,providinginformationandfeedbackrelatedtobothteamgoalsandorganizational
goalsenablesteamstostayalignedwithasharedvisionandfostershigherlevelsofcooperation.
Forinstance,inastudyoftherelationshipbetweenChinesecompaniesandtheirsuppliers,
Wong,Tjosvold,andZiYu(2005)reported thattherelationshipbetweenahighlevelofashared
visionamongemployeesandlowlevelsof opportunistically takingunfairadvantageofothers
wasmediatedpartiallybycooperativegoalsetting.WholeFoodsmakesperformance
informationandfeedbackreadilyavailabletoallemployees.Theypostafaxofregionalsales
reportsbyteamonaweeklybasis,andmakedetailedstorelevelinformationonprofitability
availabletoallemployeesonamonthlybasis.Theyevenmakeabookavailableonanannual
basisthatincludessalarydetailsforallemployeesallthewayuptotheCEO(Fishman,1996).
Whenorganizationsareabletofosteracultureofcooperationandtrust,thisincreasesthelevel
offeedbackandknowledgesharingavailabletotheirteams.Thisinformation workstogether
withselfsetteam goalstoproducehigherteam performance(Quigley,Tesluk,Locke,&Bartol,
2007).
Insummary,teamgoalsworkinasimilarmannertoindividualgoals,butinvolvesome
uniqueandcomplexconsiderations.Managerswantingtoimproveteamperformanceusinggoals
shouldbesuretoseekgoalalignmentwithintheteamandtheorganizationbydevelopinga
sharedvisionofspecificandchallengingsuperordinategoals.Theyshouldparticularlyattendto
thedevelopmentofteamefficacy,andshouldeitherinvolvetheteaminsettinggoalsorprovide
aclearandcompellingrationaleforassignedgoals.Thetensionbetweencooperativeand
competitivegoalsshouldbemanagedcarefully,andmanagersshouldseektomaximizethe
informationandfeedbackavailabletoteams.
Feedback
Forchallenginggoalstoleadtohigh performance,theyneedtobeaccompaniedby
adequatefeedback(Erez,1977).However,notallfeedbackishelpful.Indeedametaanalysis
(i.e.statisticalreview)of607feedbackinterventionsrevealedthatin38%ofcases,feedback
actuallyhadanegativeimpactuponperformance(Kluger&DeNisi,1996).Feedbackcanalso
beviewedasnotaccurateoruseful,potentiallyleadingtofeelingsofdiscouragementandanger
(Brett& Atwater,2001).Itisthusimportantformanagerstobeawareofhowtoprovide
feedbackinamannermostlikelytobringaboutapositivechangeinbehavior.Fiveprinciples
suggestedbyDeNisiandKluger(2000)forprovidingeffectivefeedbackare:
First,focusonthespecificbehaviorand/orperformanceinquestion,ratherthanonwhat
youthinkthefeedbackindicatesabouttheperson(e.g.,theircharacter,professionalism,integrity
etc).Thelattertypeoffeedbackislikelytoyieldresentment,defensiveness,anddistractionfrom
whatthepersoncandotoact/performmoreeffectivelyinfuture.
Second,provideinformationrelatingtoneededpersonalorteam performance
improvementsandminimizeinformationrelativetotheperformanceofothers(e.g.,youdid

PerformanceManagement 11
betterthan85%oftheotherteammembers,departments,etc.).Evenifsocialcomparative
feedbackisapparentlypositive,asintheexamplejustprovided,research(Kluger&DeNisi,
1996)clearlyshowsthatsuchfeedbackelicitsanegofocus(Butler,1987),usuallymakingitless
productivethanfeedbackthatframesapersonsperformancerelativetotheirgoals,past
performance,orrateofimprovement.
Third,beexplicitabouttheprecisenatureofthedesiredbehaviorandhow/whento
exhibitit.Forinstance,duringstaffmeetings,Iencourageyoutostrivetotakenomorethan
yourfairshareofairtimebytalkingeithertoolongortoooften.
Fourth,strivetoensurethatyourfeedbackprovidesabasisforsettingspecific,relevant
goals.Anexampleis:Whynottrytolimityourselftonomorethan35commentsand/or
questionspermeeting,eachnolongerthanaboutoneminuteeach?
Fifth,theamountofdatapresentedoughttobeminimizedsoasnottooverwhelmthe
personorelicitanunhelpfullydistractingegofocus.Whilepeopleoftenseekdataonhowwell
theyareperformingrelativetoothers,thisislikelytorenderfeedbacklesseffectivebyfocusing
theirattentionon theiregoratherthanonhowtheycanperformmoreeffectively.
BesidestheguidanceprovidedbyDeNisiandKluger(2000),thereareatleasttwoother
empiricallybasedrecommendationsforprovidingeffectivefeedback.First, deliverfeedbackin
aninformationalratherthaninacontrollingway,asdoingsomakesapersonssubsequent
performancemorelikelytoimprove.Thepositiveimpactonperformanceofusingasupportive
styleisparticularlypronouncedwhenthefeedbackpresentedisnegative(Zhou,1998).
Second,realizethatgreaterfeedbackspecificityisnotalwayspreferable.Although
increasingthespecificityoffeedbackfacilitatesinitialperformance,italsodiscourages
explorationandunderminesthelearningneededforlater,moreindependentperformance
(Goodman,Wood,&Hendrickx,2004).Eventhoughhighlyspecificfeedbackmaybebetterfor
helpingresolveaspecificissueandreducingerrorsofexactlythesametype,lessspecific
feedbackcanfacilitatelearningwhichbehaviorsareassociatedwithnegativeoutcomesandhow
tofix unanticipatedproblems(Goodman&Wood,2004).
Tosummarize,feedbackismostlikelytofosterpositivechangesinbehaviorwhenitis
presentedinasupportivemannerandisspecificaboutthebehavioralandperformance
improvementsneeded,therebyprovidingafoundationforgoalsetting.However,cautionis
warranted toavoidbeingoverlyspecific,soasnottolimittheextenttowhichanylessons
learnedfromthefeedbackgeneralizetoothernovelworkpredicaments.
Conclusion
Giventhekeyroleofcoachingandgoalsettinginperformancemanagement(London,
2003),wehaveoutlinedfivekeyissuestokeepinmindwhencoachingemployeestoimprove
theirperformance.Afterdiscussingrecentresearchdevelopmentsrelatedtotheseissues,wehave
providedconcreterecommendationsfortheeffectiveapplicationofgoalsettingtoperformance
management.LathamandLocke(2006),aswellasLathamandMann(2006),discussadditional
issuesandinsightsrelevanttotheshrewduseofgoalsettinginthecontextofperformance
management.
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