As anyone who has tried to lose weight knows, realistic goal-setting generally produces the best results. That's partially because it appears people who set realistic goals actually work more efficiently, and exert more effort, to achieve those goals.  What are far less understood by scientists, however, are the potentially harmful effects of goal-setting. There has been surprisingly little research on how the practice may have contributed to the current economic crisis and unethical  behavior in general. "Goals are widely used and promoted as having really beneficial effects. And yet, the same motivation that can push people to exert more effort in a constructive way could also motivate people to be more likely to engage in unethical behaviors," says Maurice Schweitzer, an associate professor of operations and information management at Penn's Wharton School. His paper, titled "Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting," appears in the February issue of the Academy of Management Perspectives.  "It turns out there's no economic benefit to just having a goal-you just get a psychological benefit and that's quite motivating in itself," Schweitzer says. "But in many cases, goals have economic rewards that make them more powerful." A prime example Schweitzer and his colleagues give is the 2004 closing down of energy-trading titan Enron, where managers used financial rewards to motivate salesmen to meet specific sales goals. The problem, Schweitzer says, is the actual trades were not earning money. Other studies have shown that pressing employees with unrealistic goals can force them to lie, cheat or steal. Such was the case, Schweitzer says, in the early 1990s when Sears imposed a sales target on its auto repair staff. It resulted in employees overcharging for work and completing unnecessary repairs on a companywide basis. Schweitzer admits his research run against a very large body of literature that praises the many benefits of goal-setting. Edwin A. Locke, from the University of Maryland, College Park, and Gary P. Latham, from the University of Toronto, write: "Goal setting is not going away. Organizations cannot develop without being focused on their desired results any more than an individual can develop without goals to provide a sense of purpose." The debate is likely to be popular on in future papers, and the practice of setting goals no doubt will continue. For now, though, the lesson seems to be to put more thought into setting goals. "They really do help to coordinate and motivate people. My idea would be to combine that with careful observation, a strong organizational culture, and make sure the goals that you use are going to be constructive and not significantly harm the organization," Schweitzer says. How did Sears' goal-setting affect its employees?
They were forced to work more hours to increase their sales. They competed with one another to attract more customers. The improved their customer service on a companywide basis. They turned to unethical practice to meet their sales target.