Definition of Goal
Goals have been defined by organisation theorists like V.H. Vroom in 1960 and A. Etzioni in 1964 as “desired future state of affairs”. Generally speaking, goals are the objectives, aims or purposeswhich are to be achieved by an organisation over varying periods of time. Goals are the result of planning which is related to future as described by Vroom and Etzioni. Planning is required both for choosing the goals and attaining the goals.
The words aim, goal, mission, objective or purposes are used interchangeably in general practice.Bertram M. Gross has tried to draw a line of distinction in the use of these terms.
According to him Mission is a general term which denotes the fundamental reason for the organization’s existence.It incorporates idealism relating to objectives within its frame. The idealism which forms part of the mission presents a very difficult or an impossible aim. For example, the labour unions have the mission of organizing the unorganized or a political party has the mission of providing the government free from all types of exploitation. Mission, therefore, reflects the long term commitment of the organisation.Mission is generally associated with non-business organisation. A government may announce its mission in terms of eradicating poverty, unemployment, economic and social inequality etc. Purpose according to Gross is an all inclusive term which refers to commitment of desired future.
An Objective may be defined as a specific category of purpose for which the organisation is committed. The objective may be production of goods or services, efficiency etc.
A Goal is even more specific and fine than the objective. An increase in production may be the objective but when its objective is expressed in relation to particular norms or standard such as increase in production by 10 units per man per week, it becomes a goal.
These distinctions become imperative when the organisation follows the policy of Management by objectives.
Importance of Organisational Goals:
Organisational goals are essential to regulate and control the functioning of individuals and groups inter se and also individuals and group in relation to organisation.
1. Focus Attention of Individuals and Groups to Specific Activities and Efforts of Organisations
2. Provide a Source of Legitimacy to Action by Members:
3. Serve as a Standard of Performance
4. Affect the Structure of Organisation
5. Provide Clues about the Nature and Character of Organisation
1. Focus Attention of Individuals and Groups to Specific Activities and Efforts of Organisations:
When organisation’s goals are known to individuals and group, it will help them in channelizing their activities towards attaining organisation’s goals. In other words the goals prescribe the course of action to individuals and groups which will be helpful and complementary to the achievement of organisation’s goals.
2. Provide a Source of Legitimacy to Action by Members:
Once this course of action has been decided for the individuals and the groups within the framework of organisational goal, it will promote legitimacy and justification to individual’s or group’s actions and decisions.
3. Serve as a Standard of Performance:
Goals provide a measure of individual’s or group’s performance. They may help the organisation members to evaluate the level of their performance in the perspective of organisation’s goals.
4. Affect the Structure of Organisation:
Goals and structure are intimately related to each other. The relationship among people in the form of authority and responsibility or the positions to be created at different levels has to be decided on the basis of organisational goals. In other words, what the organisation proposes to do will be determined by the organisational setup it will structure. Similarly, it will be the structure also which will influence the goals.
5. Provide Clues about the Nature and Character of Organisation:
The nature and character of an organisation may be known by its goals. For instance, the goal of maintaining the quality of product without much regard to return on investment may help the outsider to hold the organisation and its members in very high esteem.
Peter Drucker emphasises the point that goals are important in every area of enterprise more specially when performance and results are directly related to its survival and prosperity.
In these vital areas, goals will enable managers to:
(i) Organize and explain the whole range of business phenomena in a small number of general statements.
(ii) Test these statements in actual experience
(iii) Predict behaviour
(iv) Apprise the soundness of decisions when they are still being made and
(v) Analyze their own experience and as a result improve their own performance.
Drucker suggests eight specific areas in which goals have to be set in terms of performance and results.
These are:
(1) market standing,
(2) innovation,
(3) productivity,
(4) physical and financial resources,
(5) profitability.
(6) Manager performance and development,
(7) worker performance and
(8) public responsibility.
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