This approach to motivation has been pioneered in the USA by Edwin Locke and his associates in 1960s and refined in 1980s. Goal-setting theory of motivation suggests that managers and subordinates should set goals for an individual on a regular basis, as suggested by Management by Objectives (MBO). These goals should be moderately difficult and very specific and of type that an employee will accept and make a commitment to accomplishing them. Rewards should be tied directly to accomplished goals. When involved in goal-settings, employees see how their effort will lead to performance, rewards and personal satisfaction.
Salient features of Goal-setting theory of motivation are as follows:
- Specific goal fixes the needs of resources and efforts.
- It increases performance.
- Difficult goals result higher performance than easy job.
- Better feedback of results leads to better performances than lack of feedback.
- Participation of employees in goal has mixed result.
- Participation of setting goal, however, increases acceptance of goal and involvements.
The mere act of goal setting does not ensure higher levels of motivation among employees. In fact, there seem to be three important criteria that goals must meet if they are to influence the behavior of organization members. They are goal specificity, goal difficulty and goal acceptance.
- Goal Specificity: Goals must be stated in specific terms if they are to motivate effective performance. It should answer the who, what, when, where, why, and how of the expectations of the goal. Goals must be set in terms of measurable criteria of work performance, i.e., number of units produced, new sales etc. and must specify a lime period within which the goal is to be attained. It also gives a sense of personal satisfaction and accomplishment to workers if he is able to meet the specific goal.
- Goal Difficulty/Challenge: There exists a relationship between goal difficulty and work motivation. The more difficult and challenging the goal is, the higher the level of motivation and performance. However, it is essential that goals are set at realistic levels. Goals that are very difficult to achieve are unable to motivate since it is beyond the capacity of the concerned individual.
- Goal Acceptance: In order to influence motivation and performance, a goal must be internalized by an individual. In other words, the person has to feel some personal ownership of the goal and must have commitment to achieve it. Accepting a goal is the first step in creating motivation. Two primary factors that help to enhance goal acceptance are importance and self-efficacy. Importance refers to the factors that make attaining a goal important, including the expected outcomes. Self-efficacy is the belief that one can attain their goal.
Goal Setting Theory Mechanisms
Goal setting theory mechanisms are inputs that affect behavior in groups or individuals, which serve to increase attention to a goal, energy in pursuing a goal, persistence in achieving a goal, and ability to strategize to reach a goal. The following chart briefly describes each of the four goal setting theory mechanisms.
| Mechanism | Description |
| Direct Attention | Goals direct attention to behaviors that will accomplish the goal and away from the behaviors that will not achieve the goal. |
| Energizing | Inspiration to put out a certain amount of effort based upon the difficulty of achieving one’s goal. |
| Task Persistence | The amount of time spent on the behavior to achieve a goal. |
| Effective Strategies | In wanting to achieve a goal the individual seeks out different ways to achieve it. |
Goal Setting in Practice
The most obvious implication of goal-setting theory of motivation is that managers should be helping subordinates to set goals that are specific and reasonably difficult so that subordinates accept and internalize them as their own goals. Besides this, there are a number of issues that arise in implementing goal setting in practice.
- Though specificity of goal is essential and measurability is desirable, it should not affect in identifying meaningful and valid objective of goal attainment.
- The manager can stimulate goal acceptance in at least three ways:
- By involving subordinates in goal-setting process.
- By demonstrating a supportive attitude and approach toward his subordinates.
- By assigning various rewards to the achievement of goals.
Management by Objectives (MBO) is a managerial technique for improving motivation and performance using goal-setting principles.