The Goal Setting Process

How does the process of goal selection resemble the process of costbenefit analysis? Capacities are related to costs, but in an inverse fash- ion: The greater your capacities, the less your costs in accomplishing a particular object. And desires are related to benefits; an objective “benefit” has no meaning to you unless you desire it.

Choosing a goal is like a cost-benefit analysis in which the costs are fixed in advance—by your capacities—and your task is to choose the alternative that will provide the greatest benefit for the specified cost structure. Here again we see a link between two types of thinking that at first glance do not seem to have anything in common.

Choosing goals involves other goals and values. For example, should the goal of a youth group be simply for the kids to have a good time, or should it also be to make a contribution to the community? Choosing goals involves an entire hierarchy of goals—the very longrun and fundamental goals, the sub-goals that are part of the larger effort, and the daily sub-sub-daily goals.

Setting Goals for Organizations

For a nonprofit organization, goals are constrained by the organization’s history as well as by its present composition and program. The organization should aim to clarify its options so that those persons with a stake in the organization—its beneficiaries, staff, and donors—can thrash out the issues and reach some consensus about what the goals should be. Often, a key issue is how broad or specialized the organization should be—whether it should aim at many goals or just a few. For example, should your state university attempt to offer a very wide range of programs or should it attempt to concentrate upon a few programs in which it already is strong?

What should a nonprofit organization do when it achieves its goal, was the case with the March of Dimes when polio (infantile paralysis) was conquered? The organization could disband, of course. But that might be a waste of an expensive investment in organization.

Setting Goals for Others

Setting goals for other people is a difficult business. For example, the centrally planned Soviet economy had to set goals for each factory in order to evaluate performance. But it is almost impossible—perhaps just plain impossible—to set goals that will do what they are intended to do. For example, if the goal for a nail factory is set in terms of a number of nails, the manager will produce only small nails because they require less raw material and less work per million. If the goal is shifted to a weight of nails, the manager will make only large nails because they require less work per kilogram. If the goal is set as some combination of these two attributes, there must be some formula to trade off shortfalls or overages in the goals on the two dimensions. And it will still be possible for the manager to shave on quality unless that is made part of the goal system. This goal-setting problem is one of the best arguments for private enterprise wherein profit is an efficient overall goal.

When others set goals for you, you must consider whether your resources enable you to achieve the goals. When I was a young officer in the Navy, I was responsible for getting the decks, sides, and seamanship gear shipshape for a major inspection following a period in the shipyard. My divisions were grossly undermanned but I did not recognize that fact fully, nor did I know how to argue for more resources. The result was a poor inspection grade followed by my painful firing from a job that I liked very much. A sensible manager learns how to fight for resources to meet goals or to point out that the goals cannot be met with existing resources.