The unintended consequences of motivational techniques – goal setting and unethical behaviour

1. The unintended consequences of motivational techniques – goal setting and unethical behaviour Gottfried Catania MSc

2. PRESENTATION STRUCTURE • 1. Personal and group introductions • 2. Definition and theories of motivation • 3. Goal setting theory – basic concepts • 4. Goal setting theory – current research directions and boundary conditions • 5. Goal setting and unethical behaviour – the hypotheses and practical importance

3. INTRODUCTION • Name • Educational experience • Brief occupational history and current occupation • Any other relevant points

4. WHAT IS MOTIVATION? • 3 Components: • Direction – what a person is trying to do (choice) • Effort – how hard a person is trying (intensity) • Persistence – how long a person continues trying (duration)

5. COMMON SENSE APPROACHES • Theory X – people cannot be trusted as they are inherently unreliable and lazy. They are best controlled by using threats and financial incentives. • Theory Y – people seek independence and self-development at work. They are fundamentally moral and responsible and will naturally strive towards the good of the organization. • Social – a person’s behaviour is influenced mostly by social interactions – people seek meaningful social interactions at work.

6. EMPIRICAL/THEORETICAL APPROACHES • Maslow’s Hierarchy of Needs • Alderfer’s ERG theory • McClelland’s Need for Achievement • Vroom’s Expectancy Theory (VIE) • Adam’s Equity Theory • Herzberg’s Two Factor Theory and intrinsic and extrinsic motivation • Hackman and Oldham’s Job Characteristics Model • Locke and Latham’s Goal Setting Theory

7. INTEGRATION OF THEORIES OF MOTIVATION • While the variety of theories may be confusing, it is important to note that • 1. each one has an important contribution to offer • 2. in many cases they are compatible, but differ in their emphasis Locke and Latham (2004), amongst others, have tried to integrate the different theories into one model, and many practitioners use ideas from the different models as relevant in different situations

8. GOAL SETTING THEORY – LOCKE AND LATHAM • Pioneered in the 1960s by Locke and associates, and gained increasing empirical support up to date • By 1990s well over half of all empirical studies in motivation reported in academic journals tested, extended or refined this theory • Resulted in popular management concepts such as Management by Objectives (MBO) and SMART (Specific, Measurable, Agreed, Realistic, Time Bound) goals

9. GOAL SETTING THEORY - PRINCIPLES • Basic premise – Work performance is increased by specific and challenging (but not impossible) goals.

10. GOAL SETTING THEORY – PRINCIPLES - 2 • Further research has uncovered a number of moderators, i.e. factors which affect the direct relationship between goals and performance. These include: • Goal commitment • Goal importance • Self-efficacy • Feedback • Task complexity Rewards are also important motivators as they increase satisfaction and goal commitment

11. GOAL SETTING THEORY – OTHER POINTS • This theory is not as straightforward in its application, because of two main reasons: • People and circumstances vary, sometimes in ways which affect the goal setting process • Application in complex settings may present specific problems

12. GOAL SETTING THEORY RESEARCH • Theory has been extensively validated in both field and laboratory conditions, and over 90% of research has shown support for its basic concepts, making it one of the most valid theories in psychology • Being an open theory, research is still being conducted in refining the theory and its application

13. GOAL SETTING THEORY – OTHER ISSUES • In complex tasks, learning goals may be more effective than performance goals • Goal commitment can be fostered by clear communication about the goal, and enhanced by participation in the goal setting process • Many times there are multiple goals to be achieved • If a goal is too large or far in the future, breaking it up into more manageable smaller goals helps

14. GOAL SETTING THEORY – RECENT DEVELOPMENTS AND RESEARCH • Learning vs Performance goal orientation • Subconscious influences on goal setting • Boundary conditions of the theory – when is goal setting likely to have unintended negative effects?

15. UNINTENDED NEGATIVE EFFECTS OF GOAL SETTING – ANECDOTAL EVIDENCE Sears, Roebuck and Co – 1990s Auto repair company set sales goals for its repair staff of $147/hour, prompting staff to overcharge for work and complete unnecessary repairs

16. UNINTENDED NEGATIVE EFFECTS OF GOAL SETTING – ANECDOTAL EVIDENCE 2 Enron - 1990s Specific challenging goals fuelled rapid financial success, but focusing on revenue rather than profit drove the company bankrupt

17. UNINTENDED NEGATIVE EFFECTS OF GOAL SETTING – ANECDOTAL EVIDENCE - 3 General Motors – 2002 Market share in 2002 was 28.2%. Goal of reaching 29% was emphasized - strategies devised to reach the goal disregarded potential negative consequences (e.g. Interest free loans), money was lost and the company went bankrupt

18. POSSIBLE NEGATIVE EFFECTS OF SPECIFIC GOALS • Making one focus so narrowly that one overlooks other important features of the task • The presence of multiple goals inducing people to focus on one goal at a time – which goal will the person choose? • Goals and time horizons – focusing on short term specific goals may harm the organization in the long term

19. POSSIBLE NEGATIVE EFFECTS OF CHALLENGING GOALS • Strategies adopted to reach the challenging goal may be riskier to the organization than one would normally accept • Challenging goals may lead to unethical behaviour, by • 1. using unethical methods to reach the goal • 2. misrepresentation of performance

20. ETHICAL DECISION MAKING • Central idea – people are not intrinsically evil, but breakdowns in moral reasoning, sometimes arising from organizational interventions and policies(such as goal setting) may lead to immoral practices

21. COGNITIVE PROCESSES UNDERLYING UNETHICAL DECISION MAKING • 1. Ethical recognition – employees attention becomes so focused on the goal itself rather than the means to attain it that they fail to consider other aspects (e.g. Ethical implications) • 2. Moral disengagement – using rationalizations to justify their actions, • (a) linking deceit to worthy purposes • (b) displacing responsibility onto others

22. POSSIBLE MODERATORS OF THE RELATIONSHIP BETWEEN GOAL SETTING AND UNETHICAL BEHAVIOUR • Participative vs assigned goal setting • Personality and individual differences • Self efficacy and linking of goals to one’s self concept • Goal specificity • Goal difficulty • Structuring of rewards and their link to performance

23. KEY REFERENCES Ambrose, M. L. and Kulik, C. T. (1999) Old friends, new faces: Motivation research in the 1990s. Journal of Management, 25(3), 231-292. Barsky, A. (2008) Understanding the ethical cost of organizational goal-setting: A review and theory development. Journal of Business Ethics, 81, 63-81. Latham, G. P. (2007) Work Motivation: History, Theory, Research and Practice. Thousand Oaks, California: Sage. Latham, G. P. and Pinder, C. C. (2005) Work motivation theory and research at the dawn of the twenty-first century. Annual Review of Psychology, 56, 485-516.

24. KEY REFERENCES - 2 Locke, E. A. and Latham, G. P. (2002) Building a practically useful theory of goal setting and task motivation – A 35 year odyssey. American Psychologist, 57(9), 705-717. Ordonez, L. D., Schweitzer, M. E., Galinsky, A. D. and Bazermann, M. H. (2009) Goals gone wild: The systematic side effects of overprescribing goal setting. Academy of Management Perspectives, Feb 2009, 6-16 and related correspondence. Schweitzer, M. E., Ordonez, L. and Douma, B. Goal setting as a motivator of unethical behavior. Academy of Management Journal, 47(3), 422-432.

25. CONTACT DETAILS • gottfried.catania@um.edu.mt • gottfried71@gmail.com • Tel: 2340 2595 • Mob: 9947 4629 • Room214, Old Humanities Building, University of Malta Msida