WEBVTT

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Now, for

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a long time we believed that stretch
goals unconditionally fueled performance.

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And it turns out that stretch goals
can promote superior performance,

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as we've just discussed recently.

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But there's significant risks associated
with setting stretch goals, or

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challenging goals.

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I'll show you a quick video, and

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as you watch that video, think about,
first of all, what is the goal?

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What is the strategy to
accomplish that goal, and

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when did that strategy turn unethical?

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>> Gentlemen, the word from on high is
that felony rates district by district

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will decline by 5% before
the end of the year.

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>> We are dealing in certainties.

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You will reduce the UCR felonies by 5% or
more, or

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I've always wanted to say this,
let no man come back alive.

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>> In addition, we will hold this
year's murders to 275 or less.

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>> Christ.

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>> Feeling a little fazed, Colonel Foster?

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A little dyspeptic?

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>> Dis who?

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No sir.

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I'm good to go.

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>> Here's a fun fact for you people.

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If Baltimore had New York's population,

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we'd be clocking 4,000
murders a year at this rate.

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There is no excuse I will accept.

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I don't care how you do it.

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Just do it.

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>> Deputy, as familiar as we all
are with urban crime environment,

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I think we all understand
there are certain

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processes by which you can reduce
the number of overall felonies.

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You can reclassify an agg assault or
you can unfound a robbery.

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But how do you make a body disappear?

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>> There isn't one of you in this
room who isn't here by appointment.

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If you want to continue wearing those oak
clusters, you will shut up and step up.

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Any of you who can't bring
in the numbers we need will

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be replaced by someone who can.

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>> That is all.

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>> As you can see in this video,
goals, stretch goals,

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aggressive goals,
can promote unethical behavior.

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And we now have a rapidly building body of
evidence that suggests that stretch goals,

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aggressive goals, can trigger
unethical behavior, can push people,

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good people, to do unethical acts.

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Max Bazerman, Maurice Schweitzer,
Lisa Ordóñez,

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Adam Galinsky are among the scholars who
all contributed to this line of research.

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And what they find is this challenging
goals can promote first of all,

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our inflating our performance,
overstating our performance or

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lying about our performance.

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And it can also promote our engaging in
unethical acts to reach a particular goal.

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Examples, unfortunately, abound.

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Many years ago, Sears Roebuck set
very aggressive sales targets for

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its automotive sales people and
service people.

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And what the regulatory body,

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when they conducted an internal inquiry
into the company, found that in over 90%

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of the cases the automotive servicemen
were conducting unnecessary repairs.

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Miniscribe set very aggressive
shipping targets for its employees.

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physical bricks to customers.

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Imagine putting an actual physical brick
in the box and shipping it to a customer.

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Bausch & Lomb employees
falsified financial statements,

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responding to aggressive stretch goals for
revenue and profitability internally.

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More recently,
Toshiba employees inflated profits by

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over 1.2 billion, from 2007 to 2015,

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again responding to very aggressive
goals for profitability set internally,

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and those goals are also endorsed
by the financial markets.

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The world of academia was recently
shaken up by a series of scandals

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where scholars admitted not just to
tweaking or faking some of their data but

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falsifying their entire research agendas.

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That was during medicine in genetics,
in social sciences.

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And one of the culprits here is
aggressive stretch goals for tenure and

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receiving grant support.

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So as the goals,
as the standards get tougher and

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tougher, they can push some
scholars toward unethical behavior.

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For those of you who are from
the United States, you may remember

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one of the largest cheating scandals
in the history of this country.

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It happened in the state of Georgia
in the Atlanta school district,

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where schools faced stretch goals
to improve students' performance on

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standardized tests, and what the Georgia
Bureau of Investigation found is

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that 44 out of 56 schools ended up
cheating on the standardized test.

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178 principals and

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teachers were found to have corrected
students' responses on standardized tests.

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And if you felt that the video I showed
you in the beginning of the lesson

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was unrealistic and far-fetched,
you might wanna think again.

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There is evidence that at
least some police officers

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downgrade crimes to lesser offences
to manage crime statistics.

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In a 2012 survey of retired police
officers, it was reported that 80% of

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officers reported seeing crime rates
being manipulated by their colleagues.

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So again, one key insight from this
discussion so far is that aggressive

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stretch goals can push good
people to conduct unethical acts.

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These stretch goals can
trigger unethical behavior.

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Now, there’s a second prominent risk
that’s associated with stretch goals, and

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that is that stretch goals
can promote dissatisfaction.

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So think about this for a second.

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I can set an aggressive goal for myself,

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and I would typically accomplish more than
somebody who set a less aggressive goal.

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But I would be less satisfied.

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We find evidence for this, 
in negotiations, for example.

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Imagine this, I go into a negotiation with
a really aggressive goal, 

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and typically I would do better 
at negotiation compared to someone else

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who set a less aggressive goal.

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I would accomplish more, 
but I would

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walk out of that
negotiation less satisfied

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compared to this other person. 

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Why do you think that is?

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Think about it for a second.

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It turns out that if I set
very aggressive stretch goals,

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I'm more likely to fall
short of these goals.

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And that's what we tend to focus.

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We tend to focus on the difference
between the aspiration level and

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what we've actually accomplished.

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That's a tremendous source
of dissatisfaction.

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For people who've accomplished their
goals, they tend to compare downward,

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meaning to all of the other
folks who didn't hit a goal.

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So they're much happier.

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Vicki Medvec and her colleagues
did some interesting research

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related to these themes in
the context of Olympic medalists.

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And what they found is that
if a person crosses a cutoff,

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if they hit that baseline goal,

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they tend to again compare downward to
all the others that didn't make it.

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And what she found is that bronze
medalists were consistently happier

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than silver medalists.

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It seems like a paradoxical finding,

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but bronze medalists are just happy
they made it to the pedestal,

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looking at all these other athletes
that didn't even come close.

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Now for the silver medalist, that's
a different story, because they're looking

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up to the gold medalist and saying oh my
gosh, I came so close to the gold medal.

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And I didn't make it.

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And so I would like for
us to walk away from this discussion so

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far with two key insights.

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One is that when we set stretch,

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aggressive goals, they can trigger,
they can stimulate unethical behavior.

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This unethical behavior can come in the
form of our lying about our performance,

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inflating our performance numbers,
or we can engage in

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unethical practices to hit that particular
goal, to hit the numbers, so to speak.

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Now, the second unfortunate
risk of setting stretch goals

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is that these stretch goals can promote
dissatisfaction, precisely because they're

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much more likely to focus on the difference
between aspiration level and

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what we've accomplished.

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So burnout in organizations.

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Now, it takes in a more precise
analytical meaning one of the reasons,

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one of the causes for
burnout, is people consistently being

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faced with stretch goals, and you have
that cumulative effect of dissatisfaction.

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So keep in mind that by
setting stretch goals,

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you can promote immediate
performance results.

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You can attain superior results.

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But those results may not
necessarily be sustainable.