This article will guide you about how to make goal setting effective in an organisation.

1. Understanding the Purposes of Goals:

Perhaps the best way to facilitate the goal-setting process is to make sure that managers understand the two main purposes of goals. The first is to provide a target to shoot for. The second is to establish a framework around which other planning activities develop. As a framework, goals define where the organisation, unit, or individual is expected to beat various line in the future, and they suggest ways of getting there.


Instead of placing too much emphasis on either quantitative or qualitative objectives, management should be encouraged to develop objectives that are appropriate to the organisation’s purpose and mission. It is also necessary for managers to understand that absolute goal attainment is not always necessary for organisation success.

2. Stating Objectives Properly:

Another way of improving the goal-setting process is to make sure that objectives are properly stated. To the extent possible, objectives should be specific, concise and time-related.

(i) Specificity:


It is necessary that objectives identify the specific outcome being sought. For example, raising labour productivity by 3% is a more specific objective than increasing productivity. The objective may be made more specific if a target date is fixed.

(ii) Conciseness:

Although an objective may include all relevant variables, it should be concise. An example is rising market share by 10 to 12% in 2000 instead of just increasing and expanding a company’s market penetration.

(iii) The time factor:


Finally, a good objective should specify relevant time periods. For different types of goals — short, intermediate and long-run — goals, the time involved should be pinpointed in the goal itself.

3. Goal Consistency:

Thirdly, for improving the goal-setting process, it is absolutely essential to ensure that the goals are consistent both horizontally and vertically. There should not be any conflict among various organ­isational goals.

While horizontal consistency means that goals or different sub-units and their managers should be consistent with each other, vertical consistency suggests they should agree with work-group goals, work- group goals should be consistent with sub-unit goals, and the latter should be consistent with organisation-wide goals.


4. Goal Acceptance and Commitment:

A high-level of acceptance and commitment on the part of the individual managers is absolutely essential for meeting the organisation’s goals. People are unlikely to work whole-heartedly toward attaining any goal that they do not accept or are not committed to.

To encourage goal accepting managers have to make it clear to those who work for them that the goals are not only appropriate and attainable but are in the best interests of all concerned. As Griffin has pointed out, managers should also allow “broad-based participation in the goal-setting process where appropriate, and they should ensure proper communication of the goals, the means by which they were developed, and the probable consequences of successful goal attainment.”

In a like manner people will be more committed to goals that they helped develop and understand clearly. And there will be long-term commitment if people are rewarded for successful goal attainment.


5. Effective Reward Systems:

Perhaps the best way to enhance the effectiveness of goal setting is to integrate the goals with the organisation’s reward systems. People in organisations should be rewarded first for effective goal setting and then for successful goal attainment. At the same time, they should be assured that failure to attain a goal will not lead to punishment.

This is due to the fact that failure is often due to factors outside the manager’s control. Accordingly, the goal setting process should have both ‘diagnostic’ and an evaluative component.

Barriers to Effective Goal Setting:

Various factors create barriers to effective goal setting. Some such factors are associated with the goals themselves and others with the process of goal setting.


1. Improper Goals:

There are various forms of inappropriate goals; for example, paying a large dividend at the cost of necessary research and development expenditure. Other examples are – driving a competitor out of  business by adopting unethical practices, bribing government officials to obtain a favour such as a trade or import licence and violating anti-pollution regulations.

Inappropriate goals may arise from the reversal of a cause-and-effect relationship or what may be called a means-end inversion. In this situation, the means added to obtain an end (or goal) become the end to itself. Other inappropriate goals are those that are inconsistent without organisations purpose or mission, or both.

2. Unattainable Goals:


The second major obstacle to the goal setting process is attainable goals – goals which cannot be accomplished under the existing circumstances. Goals may be  challenging in nature but within the reach of the organisation. It is important to note that most business successes are the result of a long-term steady application of the organisation’s resources, via good strategic and action planning, to attainable goals.

3. Over-Emphasis on Quantitative or Qualitative Goals:

Another barrier to goal setting is placing too much emphasis on either quantitative or qualitative goals. Some goals, especially those relating to financial considerations, are by nature quantifiable, objective and verifiable. Others such as employee satisfaction are difficult to quantify. So, proper balance has to be maintained between these two types of goals. In other words, both kinds of goals should be taken into consideration while developing goals and in evaluating the results.

4. Improper Reward System:

At times, an improper reward system acts as a barrier to the goal-setting process. For various reasons people may be rewarded for poor goal setting and they may go unrewarded or even punished for proper goal setting. Furthermore, in some settings, people may be rewarded for achieving goals that are counterproductive to the organisation’s intent.