Goal rush: Why goal-setting isn't always a good thing

(CNN) -- When an academic report entitled "Goals Gone Wild" was released in 2009 it was greeted with delight by target-shy employees and irritation by managers.

It suggested that workplace goals were not necessarily the best way to increase productivity or revenue and led to some less than favorable e-mails winging their way to the report's co-author Lisa Ordonez, professor at Eller College of Management, University of Arizona.

One e-mail that arrived in her personal inbox came from "a more than irked manager" sarcastically thanking her for ruining the company's management strategy.

But Ordonez maintains that she and the co-authors were not advocating that managers should just relax and encourage employees to do their best.

As she explained to the irritated manager -- and others who perhaps misinterpreted her paper -- goals in the workplace are not bad by definition; rather, their true value needs to be critically assessed.

"I told her that if my paper has got you having a conversation about this then I've done my job; I'm trying to get you thinking about things," said Ordonez.

Ordonez's initial motivation to write the paper came from a belief that so much of managerial advice and writing suggested that goals were a panacea for struggling companies.

The report also highlights the times that goals had not only failed to motivate individuals but also led to unethical behavior and poor company performance.

One example comes from Enron's activities in the late 1990s when an incentive system payed salespeople commissions based on the volume of sales and let them set the prices of goods sold. It is suggested this was a dangerous and false goal -- one that focused on revenue over profit -- and contributed to the downfall of the company.

Aside from the impact financial incentives can have in skewing goals and bending ethics, Ordonez believes that "goals only become a problem when they conflict with our other values. Goals aren't themselves the issue, but the focus and narrowness can be."

Three years since the report was first published, Ordonez continues to advocate a better management "tool kit" of different techniques.

"I get the impression that people are paying attention to the more holistic approach rather than a 'let's attach a goal to something and the problem will solve itself' attitude."

Good team leaders and CEOs are those who set smarter, more flexible goals, believes Beatrice Grech-Cumbo, talent practice leader with Aon Hewitt.

The challenge for these top leaders is having "thoughtfulness and a certain amount of courage," she said.

"What we're seeing is that organizations and top leaders are being open to different goals and to have people with different roles within departments."

Over the last few years Grech-Cumbo has seen the blanket approach to goal-setting among many corporations change.

"It used to be a case of 'spreading the peanut butter' - setting the same goals across the board," she said. "But now there is a lot more complexity with different people playing different roles (in companies)."

However difficulties will remain for managers and companies to tailor goals for employees as metrics and easily quantifiable ways to measure success of failure -- be it profits or targets -- persist.

"The larger organizations get, the more we want to scrutinize and get metrics," said Ordonez.

"The more we distance ourselves from the people we manage is when we're going to get into problems."

"What works is knowing your people and environment and having a tool bag -- 'at-a-boys' and other things that get people excited, whatever that is. There is no easy answer. If I did, I wouldn't have to work as a professor."

Grech-Cumbo's advice is for managers to focus on the "what" and the "how" of goals, which can take more effort than many are used to putting in. Adding an element of learning into that can also be incredibly motivating and benefit the individual and the company.

"The advantage of really good goals outweighs the disadvantages; they can be really motivating and give a deep feeling of accomplishment," she said.