Session 354

Goals and Aspirations

Track P

Date: Monday, September 22, 2014


Time: 08:00 – 09:15

Common Ground

Room: Glasgow


  • Massimo Garbuio, University of Sydney

Title: Goals With A Warning Label?: How Goal Failure And Stretch Goal Influence Waste Reduction


  • Luca Berchicci, Erasmus University-Rotterdam
  • Andrew King, Dartmouth College

Abstract: Research in goal setting postulates that there is a positive relationship between goals and performance in doing a certain task. Recently, however, some scholars argue that goals could be counterproductive by enhancing risk-taking and unethical behavior, and by increasing the psychological cost of goal failure. Should goals require a warning label? We begin to address this question by examining how demanding goals influence performance. In the context of industrial waste prevention, we test whether stretch goals and failed goals previously set increase or decrease subsequent performance. Contrary to conventional wisdom, we find that goal failures and stretch goals have a detrimental rather than a beneficial effect on performance.

Title: Middle Managers’ Divergent Strategic Behavior and Performance Aspirations


  • Murat Tarakci, Erasmus University Rotterdam
  • Nufer Yasin Ates, Tilburg University
  • Bill Wooldridge, University of Massachusetts Amherst

Abstract: We examine the effects of individual- and organizational level performance aspirations on managers’ divergent strategic roles. Data from 123 senior middle managers governing 21 multi-country organizations (MCOs) of a Fortune 500 company revealed that both individual- and organizational-level aspirations drive a manager’s divergent strategic behavior. This finding sheds light on psychological underpinnings of managers’ strategic roles, and thereby contributes to strategy process research which has unearthed structural antecedents of middle managers’ divergent strategic roles, but has remained silent regarding psychological antecedents. We also add to the behavioral theory of the firm as we provide a multilevel perspective toward performance aspirations.

Title: Multiple Goals and the Performance Distribution


  • Miles Yang, Curtin University
  • Shayne Gary, University of New South Wales

Abstract: Many academics, consultants and managers advocate stretch goals to attain superior individual and organizational performance. However, there is limited research exploring the effects of stretch goals on organizational performance. Here, we propose to explore the effects of both stretch profit and size goals on the performance distribution. When compared with moderate goals, stretch goals for either profit or size or both improved performance for a few, while many found the stretch goals too difficult and abandoned them. Consequently, stretch goals for either profit or size or both led to higher performance variance and a right-skewed performance distribution but did not improve median performance. In complex environments, finding and following strategies to realize stretch goals is difficult and risky, and, instead, some managers adopt lower self-set goals or focus on survival. The findings extend theory on organizational goal and suggest caveats for the adoption of stretch goals.

Title: Performance Feedback and Organizational Search Behaviors in Business Groups


  • Ji-Hee Kim, KAIST
  • Ji-Hwan Lee, KAIST

Abstract: This paper examines which characteristics of business group determine the market or technology search of its affiliates. We empirically confirm that when the performance of the affiliate is below its aspiration level, the affiliate is positively associated with the market search intensity to improve their performance in a short period. When the performance of affiliate is above its aspiration level, however, the affiliate is negatively associated with the technology search accompanies higher risk, because of their tendency to maintain status quo. Moreover, our finding suggests that the level of diversification of the business group negatively influence the search behaviors by increasing the internal information dependency within the group. We found that the accumulated slack at the group level has no significant moderating effect.

Title: Psychological Variation among Senior Managers: Effect on Performance Feedback Interpretation and Strategic Change


  • Daniela Blettner, Simon Fraser University
  • Songcui Hu, University of Arizona
  • Richard Bettis, University of North Carolina-Chapel Hill

Abstract: The research on adaptive aspirations has been focused on strategic change as a direct outcome of performance feedback. However, little research has considered how managers’ interpretation of performance feedback affects strategic change decision making. Therefore, we examine the role of psychological drivers (e.g., past/future orientation, rational/intuitive) of senior managers in impacting feedback interpretation and strategic change. Using textual analysis techniques, we will analyze: important psychological drivers in senior managers of the aspiration adaptation process and the effect of such aspiration adaptation on strategic change.

Title: The Effect of Performance Feedback on Organizational Behavior: A Meta-Analytic Review and Theoretical Integration


  • Bernardo Correia-Lima, University of Amsterdam

Abstract: This study presents a meta-analytic review and theoretical integration of the effect of performance feedback on organizational behavior. It addresses three central debates in literature: What is the effect of performance below and above aspiration level on organizational behavior? Does performance feedback influence different organizational outcomes in different ways? Is the relationship between performance adjusted by aspiration level and organizational behavior moderated by aspiration source (i.e. historical or social)? Preliminary results indicate that while the overall effect of performance feedback on organizational behavior is negative, aspiration source and type of organizational outcome significantly moderates this relationship.

All Sessions in Track P...

Sun: 08:00 – 09:15
Session 459: Theoretical Foundations of Behavioral Strategy I
Sun: 09:30 – 10:45
Session 460: Theoretical Foundations of Behavioral Strategy II
Sun: 11:15 – 12:30
Session 461: Theoretical Foundations of Behavioral Strategy III
Sun: 15:45 – 17:00
Session 360: Heuristics and Biases in Strategy Choices
Session 363: Social Influence & Comparisons
Sun: 17:15 – 18:30
Session 612: Behavioral Strategy IG Business Meeting
Mon: 08:00 – 09:15
Session 354: Goals and Aspirations
Mon: 11:00 – 12:15
Session 352: CEO Decision Making
Mon: 14:45 – 16:00
Session 265: Learning, Search, Slack: The behavioral theory revisited
Session 353: Behavioral Foundations of Mergers & Acquisitions
Mon: 16:30 – 17:45
Session 359: Cognition Under Uncertainty & Risk Taking
Tue: 08:00 – 09:15
Session 358: Cognitive Processes in Strategy
Session 362: Search for Better Strategies
Tue: 11:00 – 12:15
Session 361: Creativity and Innovation
Tue: 15:30 – 16:45
Session 355: Behavioral Elements of Institutional Theory
Session 453: Competitive Dynamics
Tue: 17:15 – 18:30
Session 356: Affective and Cognitive Processes in Strategy
Session 357: Learning Processes

Strategic Management Society