Goal Congruence

Individuals work in different hierarchies and handles different responsibilities & may have different goals.
October 17, 2008

But they must come together as far as Company’s Goal is concerned,(there action must speak Co’s language.)

hmahesh45@yahoo.com, VIM Pune

Goal Congruence
Example 1– The HR manager has devised a HR training program to enhance the skills of its sales personnel, with an objective to enhance their productivity

But if company is in strategic need of attaining a certain sales volume in a given quarter, it can not do so on account of non availability of personnel. • Example 2– The marketing department has planned an impressive advertising campaign, which promises good returns, But say due to cash crunch Company’s current financial position may not let to lose the strings October 17, 2008 hmahesh45@yahoo.com, VIM Pune


Goal Congruence
Example 3 – Production Manager may get a good applause for reducing cycle time;

But at what cost? Building up the high inventory i.e. Higher investment in current assets. While doing so he just overlooked the financial interest of the company. • After completing the given activity in more efficient manner the concerned manager scores the point/s on his score card. • Whether his actions are leading to scoring of points on the organization’s score card too??, if it is so then only one can say the organization is marching towards a common goal. October 17, 2008 hmahesh45@yahoo.com, VIM Pune


Goal Congruence
• Every individual working in an organization

has got his own motive to do the work. Individuals act in their own interest, based on their own motivations. And it is always not necessarily consistent with the Co’s goal.
• In a goal congruence process, the actions

the people are led to take in accordance with their perceived self interest are also in the best interest of the organization i.e.
• Goal congruence ensures that the action

of manager taken in their best interest is also in the best interest of the organization. hmahesh45@yahoo.com, VIM Pune October 17, 2008


Goal Congruence
Scope of Strategy execution Control Efforts
October 17, 2008 hmahesh45@yahoo.com, VIM Pune

Strategic Goal

• MCS sees that how actions of individuals are put/led to achieve the Co’s goal? • Management control process helps in brining the consistency, as far as possible, in these diverse goals.

Significance of Goal Congruence
• Ensures frictionless working. • Ensures achievement of organization’s goal/strategic • Ensures coordination & motivation of all concerned. • Ensures consistency in the working of all concerned. • Gives fair chance to its employees to achieve their personal goals. • Enhances the loyalty towards the company. • Satisfies prime requirement of MCS.
October 17, 2008 hmahesh45@yahoo.com, VIM Pune 6


Factors those influence the Goal Congruence
I. Informal Factors – A.     External factors – set of attitudes of the society, work ethics of the society B.     Internal factors – (Factors within the organization) •        Culture- “Common beliefs, shared values, norms of behavior & assumptions” implicitly accepted and explicitly built into. •        Mgt. Style – Informal/Formal •        The Communication Channels •        Perception and Communication – e.g. Budget (meaning)  A strict profit October 17, control plan 2008 hmahesh45@yahoo.com, VIM Pune

Factors those influence the Goal Congruence
II Formal Factors – A. MCS strategy itself B. Rules – Instructions, manuals and circulars Physical controls, system safeguards, task control system.

October 17, 2008

hmahesh45@yahoo.com, VIM Pune


MCS - A Formal process Relating MCS to Organizational Goal
Co’s Goals & Strategies Revise Prepare Strategic Plans for Implementation Prepare Annual Programs/ Budgets Measure Responsibility Center’s Performance

Revise the Goals /Policies (Interactive MCS)


Everything percolates from the Company’s strategic goal. Anything loosing the sight of goal will be immediately taken note of and a corrective action is initiated to bring back the activity on the track.

Reward Feedback

Report Actual & Budgeted Compare A V/s B

Corrective Action Satisfactory Non-Satisfactory

Feedback October 17, 2008 hmahesh45@yahoo.com, VIM Pune 9


October 17, 2008

hmahesh45@yahoo.com, VIM Pune


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