Submission Deadline: 30 April 2020
Alfredo De Massis, Free University of Bozen-Bolzano and Lancaster University
Riccardo Fini, University of Bologna
Mike Wright, Imperial College Business School London
Donald Siegel, Arizona State University
John E. Prescott, University of Pittsburgh
The existence of definite organizational goals is a longstanding and central premise in management and organization research. Although several decades have now passed since the publication of seminal studies (e.g., Cyert and March, 1963; Fama and Jensen, 1983), many aspects of organizational goals, especially those related to their antecedents and to the processes through which they are formed and become manifest in organizations, have received scant attention and are thus only loosely integrated in management and organization theories.
Assessments of firm performance (and success) depend on how organizational goals and firm outcomes are measured. Generally speaking, success is the achievement of goals, and the assessment of firm performance is affected by how different organizational goal systems
are specified (e.g., financial/non-financial goals; multiple substitute goals, multiple positive/negative complementary goals). Unfortunately, most prior research about firm performance shares a fundamental shortcoming as it neither measures the goals of the
organization or its stakeholders, nor takes into-account the different goal systems characterizing different types of firms.
So, gaining a better understanding of these fundamental concepts gives management scholars the rare opportunity to set the rules of the game about how firm performance should be assessed. Therefore, we believe the time is ripe to reassess the concept of organizational goals and their implications for firm outcomes, and measure their impact on firm performance. Overall, we hope that this special issue will inform future management studies into the intriguing task of reconceptualizing success in management.
Aims and Scope
Just as the emergence of the primacy of shareholder value -30 years ago- reversed the trend towards corporate behaviour in the interests of managerial goals, research, practice and policy debates are now questioning the continued primacy of the goal of maximizing shareholder value in the light of various high-profile failures, and deleterious effects on employees, customers and smaller suppliers. Arguments have recently emerged that organizations should take into account a broader set of goals that reflect the wider body of stakeholders and focus on a goal of maximizing shareholder welfare (Hart and Zingales, 2017) rather than just focusing on shareholder wealth maximization.
An organizational goal is generally defined as an aspiration level on a measurable organizational outcome (Kotlar et al., 2018). Among the different variables representing the goals that an organization may pursue, researchers have mostly focused on profitability (Greve, 2003). But organizations often pursue other goals including productivity, sales, market share, and status (e.g., Baum et al., 2005), and research increasingly acknowledges the existence of a broad and very heterogeneous array of organizational goals that go beyond profit (e.g., Fiegenbaum et al., 1996, Kotlar et al., 2018).
Research to date has examined the consequences of organizational goals for organizational behaviour and outcomes. What is more, multiple organizational goals may have additive effects, jointly influencing a single outcome, as well as interactive effects, such that the
accomplishment of one goal may lower or increase the saliency of another goal, following hierarchical rules (Greve, 2008). Recent research has also shown that organizations that differ in terms of ownership type, governance, industrial sector, size, or market position, among other characteristics, pursue diverse organizational goals, and conflicts may arise (e.g., between majority and minority shareholders; between family and non-family members or among different types of family members in family firms).
All this notwithstanding, there has been little prior attempt to synthesize and compare the effects of these different goals on firm outcomes. Given the importance of goal setting for predicting organizational behaviours and outcomes, it is key to have a detailed understanding of what factors affect firms’ decision to pursue a specific set of goals.
Moreover, it is important to consider the multiplicity of firm goal systems as how the performance of a firm is assessed will depend critically on how their goals are specified (Chua et al., 2018). For instance, once scholars admit explicitly that some types of organization may also pursue non-financial goals, then no study about the overall performance of those firms in terms of either effectiveness or efficiency is possible without measuring non-financial goals. Although some analyses have been conducted on the topic (Fini et al., 2018), there is a need to develop a more detailed and comprehensive theoretical understanding of this phenomenon and the implications of organizational goals and firm outcomes on the assessment of firm performance.