ALL STATE INSURANCE COMPANY

That is why goals must, simultaneously with being challenging, be possible to reach. Unrealistic goals can only be counterproductive. How can goals serve as an unifying force in organizations? Having goals put in front of all people in the organization makes them all equal regardless of their particular position within the structure. Managers and regular employees alike, are challenged to meet certain expectations. Most importantly, the role of goal setting is to provide a challenge. Without a clear, specific and reachable goals organization members are more likely to a) work slower, b) perform poorly and c) lack interest in changing a) and b).
If we compare model of goal setting offered in the textbook and one in place at Allstate Corporation we find that they are similar in many aspects. By placing the simplified version of the model developed by Locke and Latham side by side with the description of Allstate’s particular example, the first observation is that many key words from the former are clearly repeated in the latter. Allstate has been working on developing goals for decades now and it is clear that they came a long way in that regard. Key words, such are feedback, goal clarity, direction, rewards and satisfaction are integrated masterfully in Allstate’s goal setting program, making it very effective and, also, still innovative. Two components that contribute to this effectiveness are the fact that 40,000 employees of Allstate are evaluated in terms of performance on regular basis. This makes the challenge a constant in the process, not only a one time thing. The other interesting aspect comes from the fact that company’s executives and managers draw a large portion of their compensation (25%) from Allstate’s Diversity Index. That way they are committed in implementation of the program. Allstate recognized the importance of mediators and moderators in goal setting schema and keeps making them accountable for programs success.
Diversity Index