Management Theory in Action by Eric H. Kessler

Author:Eric H. Kessler
Language: eng
Format: epub
Publisher: Palgrave Macmillan
Published: 2009-12-31T16:00:00+00:00

To increase peoples’ intrinsic motivation, I will...

6.10 Applying Stretch Targets

Ask Yourself: Have you ever been challenged to achieve something so big or important that it could not be accomplished through your normal methods or everyday patterns of behaviors? Might these types of visions inspire employees to move outside their comfort zones and fundamentally improve their approach to work? Could these big ideas inspire them to achieve things that were seemingly unimaginable under the old system of doing things? How can managers effectively use stretch targets to motivate their employees?

Management Theory: Stretch targets, which are extremely ambitious but not implausible objectives, are motivational tools that change the way people work and thus push them to higher levels of performance. By setting aspirations that are seemingly unreachable with present processes and methods, these audacious challenges make employees think about their jobs differently. If managed well a stretch target can get people to perform in ways they never imagined possible. Of course when setting stretch targets managers must provide their people with the knowledge, tools, and means to meet such ambitious goals. If not the effects of setting stretch targets can be disastrous in terms of eroding their self-confidence and motivation. In the public arena we see stretch targets in such motivational calls to put a man on the moon (along with an allocation of the necessary resources to enable it) or in modern times to achieve energy independence (future unclear). At work we also see them in motivational methodologies calling for divisions to be first or second in market share or for a large portion of yearly revenues to come from newly developed products. Stretching requires that employees do things differently, and it is this “double-loop” learning that requires them to question their assumptions, break their habits, push their limitations, and reengineer their processes. Indeed this motivational approach is a driving force behind many of the world’s most innovative accomplishments and successful organizations. Our story is by an insurance manager who developed and began implementing a plan to employ super-challenging “stretch-targets” but, to their chagrin, has found that it is not as easy as one would hope.

In Action [Case Study]: The purpose of stretch targets is not only to allow employees to stretch their abilities to new levels, but also to change the organization’s competitive position by dynamically altering its thinking and business processes. This was a timely skill for me to focus on as I work for an international insurance company undergoing reorganization. My division currently underwrites Domestic (U.S.) health plans, as does our office in Dublin, Ireland. The parent company decided to merge the two operations. Obviously our cultures are very different. Our ambitious goal was to mesh the operations and develop best practices without losing the momentum and motivation of the staff on both teams. We also wanted to minimize turnover and increase employee satisfaction. The only way we could do this was to radically redesign the way we did things, the way we set targets, and how we measured success.

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