Goal setting theory offers that specific and challenging goals, along with appropriate feedback, can significantly drive behavior and enhance performance. This widely studied, accepted and adopted theory suggests that employees will show increased effort, focus, persistence and exhibit inquisitiveness of task-related knowledge, skills and strategies. The idea is that the more specific and more challenging the goals are, the more employees are motivated to mobilize effort, develop plans and improve their knowledge to achieve the goals.
One well-known tactical approach is the use of SMART goals: Specific, Measurable, Achievable, Relevant and Time bound. For those of us who’ve been given SMART goals or have introduced them to employees, we’ve absolutely seen the focus and drive they can create because of their specificity. We also realize how important it is to have well-rounded goals with frequent and critical feedback. However, I propose that we’ve also seen unintended consequences when they lose sight of the broader picture, focusing solely on SMART goals.
As an example, my SMART goals, right now, are five deep; these are also the exact goals of my team with just a few minor tweaks. And, importantly and illustratively, they are my only written goals. They are challenging, narrow and “stretch goals” and exclusively associated with hard number measurements such as: “Achieve a 40% increase in proposals from the prior year”. Focusing on pure financial, economic or pure number measurements can cause inconsistency with other parts of the business. In other words, we can lose sight of other importance such as customer service, long-term planning, product development, teamwork, culture, fun and our personal, intrinsic, drive. I argue that when people are measured by their specific goals alone, too often they just put their head down, pull those goals out and focus on them, and them only, at the detriment to other important, not measured, factors.
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Why might we do this? Bounded Rationality states we consider small sets to choose from when making choices and if one has clear and stated goals, they’re likely to follow those first because that’s what’s being measured. To put a further point on it, If I’m given five (5) very clear and difficult goals to meet I’m going to work hard to make those happen especially if my salary, bonus and job depend on it.
Unintended consequences certainly exists such as Tunnel Vision, taking unnecessary risks to hit the goals and unethical behavior. However, my main concern is that employees can lose their intrinsic motivation, having it replaced by external goals which may not line up, at all, with those things that drives their purpose. When we’re given goals that we can’t ‘connect with’, we can lose the motivation that drives us. Personally, my passion is the individual relationships I create with customers, vendors and industry partners. In some cases, these cultivated relationships have taken years to grow and have provided me with countless personal and business rewards. Just this year alone, I was able to secure two very large customers via my friendships with CEO’s where we succeeded, in large part, due to their trust in me. This cultivation doesn’t happen overnight.
It doesn’t happen with tunnel vision focused on quarterly numbers. Instead, it happens with a focus on doing the right things with the right people. Yet, nowhere in my SMART goals does it reflect this critically important intrinsic motivation factor for me. If I only looked at the current goals, I wouldn’t focus on long-term relationship building because my goals only speak to economics. And even more descriptive is the story of my lead marketing coordinator. She has an infectious passion for creativity and being seen as the biggest helper on the team; she thrives on being everyone’s ‘go-to’ marketing support person.
Back in 2017, we thought that she had all the skill-sets to move up and we shaped her SMART goals on learning new parts of our business including the core functions of accounting, finance, actuarial and product design. We thought we could direct those creative talents into something that could generate revenue for us, thus paying her wildly more money along with additional responsibility. In the end, it was the worst six months of her entire career. We had it all wrong. Our extrinsic SMART goals didn’t line up with her intrinsic motivations and while she muddled through it for six months, together we realized that we’d made a fatal error. We almost lost her because we didn’t seek to comprehend her motivations and include them in her goals.
Extrinsic motivation, if not connected/associated with our intrinsic drive, can be seen as totally about something or someone else. Thus intrinsic motivation can be in peril when extrinsic motivations are thrust at employees. Think about the Enron, Wells Fargo or Washington Mutual employees who were given challenging financial goals, dare I say likely SMART goals. Not only did they exhibit unethical behavior but I would argue that they had very low intrinsic motivation along the way; I don’t imagine pushing through phony accounts, bad loans or fraudulent finances is intrinsically motivating to many. “Enron executives were meeting their goals, but they were the wrong goals,” according to employee compensation expert Solange Charas.
SMART goals can be effective but they must be created with knowledge of negative unintended consequences; especially and arguably the most important of which is intrinsic motivation. I propose modifying SMART goals similar to what McGill University has proposed using the acronym HARD. This addition focuses attention on making it personal and adding the element of “Why?” It serves to bring ‘goals to life’ and intrinsically rally them to the organization’s cause.
- Heartfelt: An emotional attachment to your goal; it has to scratch an existential itch.
- Animated: Motivated by a vision, picture or movie that plays over and over in your mind.
- Required: Feels so urgently necessary that you start acting on them right here, right now.
- Difficult: Drags you out of your comfort zone, activating your senses and attention.
In closing, research has shown direct positive links between goal setting and performance but seems to have understated the impact created by unintended consequences, namely intrinsic motivation. I like the way Max Bazerman and colleagues describe how we should look at goal setting, not just as the prescribing practitioner but also as the end consumer, through a new and intrinsic lens.
Rather than dispensing goal setting as a benign, over-the-counter treatment for motivation, managers and scholars need to conceptualize goal setting as a prescription-strength medication that requires careful dosing, consideration of harmful side effects, and close supervision
