Setting Goals To Guide Management Decisions

Goals! Goals! Goals! Almost everyone is enthusiastic about goals. Most people like to discuss goals; some boast of having goals. If you ask a friend or business associate about goals, almost certainly you'll get an affirmative response one that implies goals are definitively known and are important. You also may receive a spontaneous goal attainment report. If so, it's likely to be an exultant report of goals that have been attained and a progress report on those where attainment still lies in the future.

People who teach management also attest to the importance of goals. Listen to almost any management guru, and you'll hear ideas like these:

Identify your goals. Manage to attain them.

Management is goal-directed.

Take charge of your life and work set goals and attain them.

Without goals, you can't be a manager because you won't know what you want to achieve through your management decisions.

Virtually everyone agrees on the importance of goals. Most find satisfaction in asserting that they have goals, and in declaring that they use goals as guides for their management decisions. Without doubt, goals are important.

The Goals Paradox

Despite almost universal recognition that goals are important, few people have written records of their goals. If you ask a farmer, a rancher, a fruit producer, an extension economist, or a chance acquaintance for a list of goals, you're likely to get a guarded response. That response polite or not will imply that your request is not really appropriate.

If you insist, you may receive a "goals list," but it's likely to have only nebulous or simplistic entries. Some entries may be both nebulous and simplistic. Indefinite statements of desired results ("to make a profit") or short-term task goals ("to finish harvest by November 1") are typical entries in a "goals list" produced in response to an insistent request.

Not everyone will respond with nebulous and simplistic goals. A small proportion of people you might ask for a "goals list" will have carefully identified goals that have been written down. These people may or may not want to share their goals with you. As personal statements, goals may be too private to release for public examination.

Most people with a goals list identify only business goals. It's rare to find people with written goals for their personal and family life. Their actions with respect to family, friends, and organizations indicate definite commitments to these personal and family life involvements. However, their visions of desired outcomes for these aspects of life are usually intangibles mental constructs not coherently written goal statements.

The paradox of goals is this: Many people will publicly affirm that they have identified their goals and that goals are important. But, most cannot or will not record and communicate their vision of desired outcomes in the form of a goal statement that can be communicated to others and used to guide their management decisions.

Why the Paradox?

The paradox that there are many "goal talkers" but few "goal writers" is an intriguing aspect of human behavior. We know very little about why some people identify goals and many others do not. Perhaps differing expectations among those associated with a farm or other business cause them to avoid identifying goals. We do know that many people who verbalize the importance of goals goal talkers--do not invest time and effort in systematic goal identification. Perhaps they do not recognize that clearly identifying goals can help them increase their management capability, personal satisfaction, and quality of life.

Identifying Goals

For many years, management workshop instructors have encouraged clients to put their goals in writing. For many participants, quickly developing a vision of the near and distant future to which they are willing to commit themselves seems as difficult as developing in 5 minutes an answer to the question, "What is the meaning of life?" When participants are unable to respond, the instructor often assumes that profit maximization is the principal goal of all participants and continues with the workshop.

This approach which assumes that more profits will ensure the outcomes the participants seek in life generally does not work very well. Even casual observation of human behavior indicates there is more to life than maximizing profits. Profits can't be ignored they are vital to continuation of a business but managers have goals for their personal and family lives, as well as for their businesses. The complex, often conflicting, demands of family and business goals can limit a manager's desire and ability to maximize profits.

For every manager and every business, the ultimate question is, "What am I managing to attain?" If goals have been identified that adequately describe desired conditions and outcomes, the obvious answer is: "Manage to attain goals." Thus, the quality of goal identification is a primary determinant of management effectiveness.

In several States, purposive goal identification has been included in financial management education programs during the past 4 years. Individuals, families, and business associates involved in farm operations have had the opportunity to identify family and production unit goals. They usually have been successful and committed to goal attainment when they have taken active roles in goal identification and when the privacy of each group has been maintained. Participants in most of the management units identified goals and used them to guide management decisions. Participants reported these positive outcomes from the experience:

Communication among family members improved.

Management decisions and work activities were more effectively focused on priority concerns; management effectiveness increased.

Cash-flow management in the production unit and household improved as impulse buying of production inputs and household items was reduced.

Borrowing, risk, and interest expense were reduced.

Conflict was reduced, and working relationships improved.

Expenses were kept under control, and profits increased.

Anxiety and concern over the present and future were reduced.

There was a better balance between production activities and family life.

The communication, negotiation, and compromise required for goal identification yield additional important benefits. When goals are selected in a way that ensures that each person does work that he or she enjoys, motivation increases and management performance improves. Perceptions of reality are modified as participants gain a greater understanding of each other's roles, interests, and activities. Identifying goals has both immediate and long-term payoffs the quality of daily management outcomes and the focus of longterm decisions are improved.