Strategic goals are set at the top of an organization and directly support the mission statement. Strategic goals are related to the entire organization instead of any one department. There are eight types of strategic goals found in organizations. The first type of strategic goal affects market standing, for example " to control 45 percent of the market share in the United States by the year 2011." Strategic goals regarding market standing help position a company as a market leader in any given industry. An example of the second strategic goal, innovation, is "to develop three new applications for use in businesses in the United States over the next three years." Productivity, the third type of strategic goal, involves reductions …show more content…
Individuals at the bottom of the organization's chart set the goals and objectives for members directly above. Operational goals and objectives determine the tactical objectives, which in turn determine the strategic goals and objectives. Finally, the organizational mission is defined according to the guidelines set by the employees. Goals determined by bottom-up goal setting are likely to be more realistic than those set at the top of the organization. They are more flexible and reflect the current situation of the organization. Finally, goals created by all levels of the organization, and by all types of employees, are more likely to encourage employee commitment. There are disadvantages to bottom-up goal setting. Goals and objectives formulated by bottom-up goal setting are not always in line with the organization's mission. Often, organizations that use a bottom-up approach lack clear direction and focus. There is no hierarchical alignment with the goals of the organization. Another disadvantage of this type of goal setting is that the goals created by employees are not always challenging and ambitious. Studies have shown that challenging (yet realistic) goals are more motivational than those that are …show more content…
Interactive goal setting involves discussion and cooperation among management and employees. The interactive approach enjoys the same advantages as bottom-up goal setting without many of the disadvantages. Goals are more realistic and current than in the top-down approach. Because it involves cooperation at all levels, employees feel valued and important. Their commitment to the organization, as well as the goals, is increased. Input from upper management helps to ensure that the goals are challenging and ambitious, which increases motivation. There are, however, a few disadvantages to the interactive approach. It is very time consuming because of the cooperation and consensus involved. It is also difficult to manage and maintain. If managers do not stay actively involved, it can quickly turn into a top-down or bottom-up approach with the disadvantages of