The Upside Downside of Goal Setting in Organizations


For over forty years researchers have touted that an organizational focus on goal setting is critical to it surviving and thriving.

Why is it so vital for all employees to understand and focus on their part in adhering to the overall organizational strategy; so everyone is travelling in the same direction, toward the same outcomes? Could there be downside to such a blatant focus of attention?

This blog briefly explores the pros and potential cons of such a focus.

The Upside of Goal Setting

Alice came to a fork in the road. “Which road do I take?” she asked. “Where do you want to go?” responded the Cheshire Cat. “I don’t know” Alice answered. “Then,” said the Cat, “it doesn’t matter.”   “So long as I get SOMEWHERE,” Alice added as an explanation. “Oh, you’re sure to do that,” said the Cat, “if you only walk long enough.”

The importance of goal setting, with respect to not only surviving but thriving, within an organizational setting has been greatly influenced by the empirical research carried out by researcher such as Prof. Edwin Locke of the University of Maryland and Prof. Gary Latham of the Joseph L. Rotman School of Business, University of Toronto over the past four decades. Their research is based on T.A. Ryan’s (1970) proposition that making conscious goals affects our actions.

Locke and Latham’s goal-setting theory suggests individuals who create difficult but attainable goals outperform those who have less difficult goals.  They claim that “So long as a person is committed to the goal, has the required ability to attain it, and does not have conflicting goals; there is a positive, linear relationship between goal difficulty and task performance.”

According to Locke and Latham, there are five goal setting principles that can improve the chances of success:

1. Clarity: When goals are clear, we know exactly what needs to be achieved. Results can be measured accurately, and those actions can be rewarded.
2. Challenge: We’re often motivated by challenging goals, however it’s important not to set a goal that is so challenging it’s unachievable.
3. Commitment: To be effective, we and all members of our team must understand and agree to the goals – which happens, more often than not, when we and they have been involved in creating the goal in the first place.
4. Feedback: the continuous activity of self-feedback or feedback from others helps us and our teams know if we’re on track to reach our goal successfully.
5. Task complexity: We need to ensure work doesn’t become overwhelming in a highly complex goal/task environment. If individuals work in complicated roles, they will often push themselves too hard if they don’t understand the complex nature of their roles and goals.

The Potential Downside of Goal Setting

An article written by Lisa Ordonez, from the University of Arizona, Maurice Schweitzer, from Wharton Business School, Adam Gaklinsky, from Kellogg, and Max Bazerman, from Harvard, collectively challenge what they describe as, “over-prescribing goal setting”.
Their insights may give us some valuable points to consider when setting organizational, team and individual goals.

According to David Clutterbuck, Ordonez’ and her colleagues’ arguments against putting organizational effort into ensuring people set and pursue clearly defined goals can be summarized as follows:

  • Because goals focus attention, they reduce people’s attentiveness to other factors that may help them achieve or contribute more. The lack of context (staring at the ground rather than seeing the trees) makes it easier to focus on the wrong goals. (Clutterbuck also adds that it also makes people less able to recognize when a goal has become inappropriate.)
  • Narrow, short-term goals tend to promote “myopic, short-term behaviour that has the potential to harm the organization in the long run”
  • People motivated by specific, challenging goals tend to adopt riskier strategies… than do those with less challenging or vague goals
  • Goal setting can induce unethical behaviour, especially where people just miss challenging goals
  • Goals inhibit learning – an individual who is narrowly focused on a performance goal will be less likely to try alternative methods that could help her/him learn how to perform a task
  • Goals may increase extrinsic motivation, but they may also harm intrinsic motivation

As professionals within an organization, if we are aware of both sides of the goal-setting coin we’re able to enter into the creation of them with a broadened perspective.


Clutterbuck, D., (2011), A Great Spat Over Goals,

Daniels A., A Theory of Goal Setting By Locke & Latham,

Locke E.A., Latham G.P. (1990), A theory of goal setting and task performance. Prentice Hall, Englewood Cliffs, NJ

Locke E.A., Latham G.P. (2002), Building a Practically Useful Theory of Goal Setting and Task Motivation: A 35-Year Odyssey. American Psychologist, . Vol. 57, No. 9, 705–717

Mind Tools, Locke’s Goal-Setting Theory: Setting Meaningful, Challenging Goals, Mind Tools,

Oracle White Paper (2012), Goal Setting: A Fresh Perspective,

Ordonex, L.D., Schweitzer, M.E., Galinsky, A.E. and Bazerman, M.H. (2009), Goals Gone Wild: The Sysetmeic Side Effects Of Overprescribing Goal Setting, Academy Of Management Perspectives pp. 6-16,

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