Goal-setting theory, created and conceptualized by E.Locke and G.Latham (1990), is based upon the following presumption: human-beings usually direct themselves with specific objectives, which should be clear and concrete, challenging (so that the job or other activity doesn't seem monotonous) and achievable.
The first pillar of goal-setting is the concretization of desirable results. , "Specific, challenging goals result in better performance than abstract goals. Specific goals define an acceptable level of performance, whereas, abstract goals, prejudice employees self-evaluation of their performance." (Sejits, 2001: p.251). Specific goals thus 'approach' the executor to more global objective, especially if they are measurable and include defined deadlines. Furthermore, there is a linear interrelation between the complexity level of the goal and the apposite performance - if the goal is higher, the performance also grows. This proportion, however, begins to decline once the employee reaches the limit of their capacities. Goals should be reasonable and realistic so that they influence organizational performance in a positive way (Locke and Latham, 1990).
Another idea within goal-setting theory is the concept of accurate feedback, which is important in hierarchical organizations, but doesn't really affect performance or alleviate goal-setting process. Giving reliable and trustworthy feedback might also turn into a "challenging exercise" (Locke and Latham, 1990: p.302).
Goal-setting depends also upon the initial incentive degree: if an employee has high intrinsic motivation from the very beginning, long-term goals increase it, whereas short-term goals are likely to level it off.
The basic presumption of cognitive evaluation theory is the human need for competence and self-determination (Deci and Ryan, 1985). External events associated with the inducement and maintenance of behavior is likely to influence an individual's intrinsic motivation to the degree they affect the perceived locus of causality for that activity of behavior. "Events that promote a more external PLOC will undermine intrinsic motivation, whereas those that promote a more internal PLOC will enhance intrinsic motivation. External events that promote an external PLOC promote extrinsic motivation, because they neglect the need for self-determination and instead establish- an if-then contingency between behavior-consequence" (Reinig, 2003: p.70). In other words, individuals need a feeling of control over the situation and either consciously or unconsciously perform the surveillance of the external event, trying to match it with their competence level. The aspect of control is vital, as it affects both extrinsic and intrinsic motivations (Deci and Ryan, 1985; 1991). In addition, Deci and Ryan (1991) hold that informational aspect also determines incentive, as intrinsic motivation grows when the person gains external proofs of their competence.
Both theories therefore divide motivations into extrinsic (related to achieving social merits) and intrinsic (associated with positive emotions, happiness, enjoyment). The theories also support the three commonly accepted stages of motivating: energizing, directing and maintenance in terms of behaviors and performance (Locke and Latham, 1990; Deci and Ryan, 1985), whereas the theorists propose different stimuli fro the growth of