Explain goal-setting theory. Goal-setting theory is a technique used to raise incentives for employees to complete work quickly effectively. Goal Setting Theory of Motivation Edwin Locke’s goal-setting theory is among the most dominant theories of work motivation. Goal setting involves the development of an action plan designed to motivate and guide a person or group toward a goal. In such cases, the goals of an individual may come into direct conflict with the employing organization. In 1968, Edwin A. Locke published his groundbreaking Goal Setting Theory in Toward a Theory of Task Motivation and Incentive. In the 1960s, Edwin Locke proposed that intentions to work toward a goal are a major source of work motivation. Learning Outcome. Systematic and rigorous reviews and meta-analyses have found substantial support for the basic principles of the goal-setting theory. In an organization, a goal of a manager may not align with the goals of the organization as a whole. The principles are simple and effective, and can demonstrably improve motivation and performance at an individual or team performance. Locke’s Goal Setting Theory gave us the blueprint for modern workplace motivation by making the direct relationship between goals, productivity and employee engagement both clear, and actionable. Thus Goal Setting Theory can be useful in predicting job satisfaction and subsequently employee engagement. Goal setting can be guided by goal-setting criteria (or rules) such as SMART criteria. Goal setting theory (Locke & Latham, 1984, 199Oa) is based on the simplest of introspective observations, namely, that conscious human behavior is purposeful. What you’ll learn to do: explain goal-setting theory. Job satisfaction is an important attribute for employee productivity and commitment to the organization. Without aligning goals between the organization and the individual, performance may suffer. This theory emphasizes that all behavior is motivated, and motivation is a goal-directed process. Limitations of Goal Setting theory. Goal-Setting Theory. Locke and Latham’s Goal Setting Theory and its principles for goal setting are a great way to think about what makes a good goal. Goal-setting theory has its limitations. Goal setting leads to better performance by increasing motivation and efforts, but also through increasing and improving the feedback quality. At times, the organizational goals conflict with the managerial goals. Goal setting is just like any other skill and so it takes practice to become good at setting and achieving goals. Unfortunately, many leaders and organizations fail to put enough effort into setting effective goals. In this section, you will learn about one of the most influential and practical theories of motivation: goal-setting theory.