Industrial Psychology

PERSONNEL PSYCHOLOGY 2001,54

THE IMPORTANCE OF UNDERSTANDING AND CHANGING EMPLOYEE OUTCOME EXPECTANCIES FOR GAINING COMMITMENT TO AN ORGANIZATIONAL GOAL
GARY P. LATHAM Rotman School of Management University of Toronto, Ontario, Canada

Senior management and the union executive committee of a forest products company set an oiganizational goal to reduce theft from approximately a milliondollars a year to zero. Salaried and hourly employees, selected at random, were interviewed regarding their outcome expectancies for honest and dishonest behavior. The responses were categorized within a 2 x 2 empathy box (honest/dishonest behavior vs. positive/negative outcome expectancies) to allow the organization's leadership to understand from the employee's perspective why there was so muchtheft. This information was subsequently used to alter employee outcome expectancies which, in turn, changed behavior. Theft dropped to near zero. Central to the theory and application of goal setting is goal commitment (Locke & Latham, 1990). If there is no commitment, there by definition is no goal. Commitment to self- set, participatively set, and assigned goals for individuals and small groups hasbeen relatively easy to bring about in both field and laboratory settings. This is because the goals usually fall within what Christian Barnard (1938) called the person's zone of indifference. Moreover, assigned and participatively set goals in the workplace are usually the result of discussions with a person who has legitimate, referent, or expert power (Locke, Latham, & Erez, 1988). TTiree keyconstructs in social cognitive theory (Bandura, 1986; 1997) include goal setting, self-efficacy, and outcome expectancies. Self-efficacy is task specific; it is the measure of the extent to which one believes that one has the knowledge to master the task or the ability to acquire it. Self-efficacy has been found to have a direct effect, as well as an indirect effect through goals, on performance(see Locke & Latham, 1990).
Preparation of this paper was funded in part through a SSHRC grant. Portions of this paper were presented to the XXVII International Congress of Psychology, Stockholm, Sweden, 2000. Correspondence and requests for reprints should be addressed to Gary P Latham, Rotman School of Management, University of Tbronto, Tbronto, Ontario, Canada M5S 3E6;latham@rotman.utoronto.ca.
COPYRIGHT © 2001 PERSONNEL PSYCHOLOGY, INC.

707

708

PERSONNEL PSYCHOLOGY

Interventions that increase self-efficacy increase effort and persistence to attain difficult or challenging goals. Goal-setting studies that have included measures of self-efficacy typically obtain findings that are statistically significant. Outcome expectancies are a measure of the extent to which one seesa causaJ relationship between one's behavior and the positive or negative outcome that one expects, goal-setting studies that have included measures of outcome expectancies have typically found nonsignificant results (e.g., Frayne & Latham, 1987). TTiis is likely due to the fact that the goal was set by or for the individual or a small group. Thus, these nonsignificant findings are likely due to arestriction of range. The positive outcome expectancy or attractiveness of attaining a goal that is self-set, participatively set, or assigned is almost always uniformly high. This is not necessarily true, however, for an organizational goal. What is transparently a positive outcome for the organization as a whole (e.g., cost reduction) is not necessarily positive for an individual employee.Hence understanding the employee's outcome expectancies regarding the attainment of an organizational goal and, if necessary, altering those expectancies may be critical for getting the employee to pursue it. The purpose ofthe present study was to understand and then change employee outcome expectancies in order to gain commitment to an organization's goal: namely, the reduction of theft from...