M.S. for managers: is a benchmark against which to evaluate the success.
for employees: defines a common purpose.
for external parties – investors, governments – unique insight into an organization’
values, and future directions.
The nature of organizational goals
Use of goals – benefits
a) can increase performance b) help clarify expectations c) facilitate the controlling function – provide benchmarks d) increased motivation
Levels of goals
First level management – operational goals
Targets or future results set by lower management that address specific measurable outcomes required from the lower levels.
Middle management – tactical goals
Targets or future results usually set by middle management for specific departments or units
Spell what must be done to achieve the results outlined in the strategic goals. Tend to be stated in more measurable terms than strategic ones.
Strategic goals – top management
Broadly defined targets or future end results set by top management. Called “official goals”.
Market standing - desired share of present and new markets
Innovation – in products, services, in skills and activities as required
Human resources - supply, development and performance of managers
Physical resources – facilities and how to use ‘em in production process
Productivity – efficient use of resources relative to outcomes
Social responsibility – community and ethical behavior
Profit requirements – level of profitability, other indicators.
How goals facilitate performance
Five major characteristics of effective goals:
Challenging. Difficult goals lead to higher performance
Attainable. Usually work best when they are attainable. At some point, use of maximum skills and abilities and cannot achieve higher performance levels. Even with difficult goals individuals usually attempt to achieve as much as possible – if they are given credit for what they do achieve.
Specific and Measurable. Clear what is expected and when the goal has been achieved. Quantitative goals and qualitative ones.
Time-limited. Should be a defined period of time wihin which the goals must be accomplished.
Relevant. If clearly relevant to the major work of organization and the particular department.
Goal commitment – one’s attachment to, or determination to reach, a goal. To feel committed.