In addition to the good in goal setting, there are also some important pitfalls or the bad and the ugly about goal setting. Let me tell you a story about Wells Fargo in 2016. They launched the Great Initiative. Gr-eight initiative. They set a goal for their employees to sell at least eight financial products to their customers. By a financial product what I mean is Is a checking account, a debit card, a credit card. They wanted at least eight financial products per customer. This also is known as cross selling. So you come in and open a checking account. Or you come in and have a home mortgage and they try to sell you other financial products. Now we all know that goal setting can boost motivation and boost performance. It motivates people to do more. Here's the problem. What happens if you're struggling to hit that goal? What then? We know psychologically, it feels terrible to fail to meet a goal. And it presents a dilemma for employees or other people who are trying to hit a goal. And what often happens is that people cut corners. And in the case of Wells Fargo, they opened 2 million fake accounts to meet these sales goals. So employees were opening accounts with customers that customers had not authorized. They, at Wells Fargo ended up firing 5300 employees and they paid $185 million in fines. Now, one idea is to say, well, there's some bad apples here. There's some bad employees doing the wrong thing. My view is that it's not the employees, it's the system. And any time they have to fire over 5,000 employees over the same problem, it's not a few bad apples It's a problem that's more systemic. And here it's goal setting that's the problem. And the CEO John Stumpf actually came out and said we are eliminating product sales goals because we want to make certain our customers have full confidence that our retail bankers are always focused on the best interests of customers. So they're eliminating the goals because the goals were a problem. Now, this brings me to this idea of some work that I've done that we titled Goals Gone Wild, because goals can do, in addition to very positive things, some negative things. They can focus attention too narrowly. So that is we're focused on hitting that goal. So, think about a runner. They're trying to hit that goal. They're focused on hitting that time and they're ignoring the pain in their knees. Maybe that's the right thing to do, maybe it's not. But goals focus attention in a way that can drive performance. Goals can also increase risk taking. So we take on more risk to try to hit that goal. That is since we care deeply about hitting that goal, particularly when we're close to it, we might take risk that might allow us to reach the goal. And the difference between falling short by a little and falling short by a lot may not be that important to us. Goals can also lead to unethical behavior. The Wells Fargo case is not an isolated case, there are many others. So here's the idea about a narrow goal. General Motors, years ago, set a goal for 29. Now, in 2002, they had 28.2% of the US market, they set a goal for capturing 29%. So they created buttons and pins for executives to wear, with the number 29. So these executives were walking around with pins that said 29. And the goal was to increase market share. Well it turns out that GM expanded the offering of interest free loans and no money down incentives. They're trying to get people to buy the cars to reach their 29% goal. They were losing money on a per car basis. In the effort to meet this goal. Now you could say well they're trying to meet the goal but they're missing the broader focus that is the goal setting process narrowed their focus on 29% of market share. But of course, that's not really the goal. The goal is to be profitable at the same time. So, they were missing the broader picture, because the goal setting process had narrowed their focus. So, they ended up saying, well this is what Forbes said, fixated on this target, the firm went on to make decision after disastrous decision that helped drag it to the brink, and then past the brink, of bankruptcy. So GM ended up going bankrupt because they ended up pursuing this narrow goal that really didn't reflect their broader goal. There are other cases. So in the United Kingdom, the health commission reported that there were 400 deaths at Stafford Hospital because they had excessive focus on certain targets. So we see this across industries, across time. People end up narrowing their focus because of goal setting that really does, by its inherit nature, focus people on specific targets. Now, risk taking. Goal setting also promotes greater risk taking. In 2003, Fannie Mae and Freddie Mac the large institution designed to support mortgages for all Americans but particularly people with lower incomes. They set out a goal to have 20% of the mortgages for low or very low income families. This was up from 14% in the preceding years. So at the end of the 1990s, 14% of the mortgages were for low and very low income families, 2001 to 2003, they have a goal of boosting it to 20%. They ended up making very bad loans Loans that were so risky and so bad they ended up filing for bankruptcy and a government bailout in 2008. So here they set a goal and they ended up taking on more risk than they could handle. In our own research, we've looked at goal setting and found that people are more likely to engage in risky and unethical behavior when they're pursuing a goal. So we've seen this in negotiation studies. People with goals are reaching less profitable agreements, they're making larger demands. And people who have talked about the destructive goal pursuits. In other domains too, like the 1996 Mt Everest disaster. As we were trying to reach their goal of submitting the mountain, they took on too much risk and sometimes with disastrous consequences. Now, goal setting can also get us into deep trouble. The Jolly Green Giant for example rolled out a plan where as they harvest vegetables, they want to make sure there are no insects along with those vegetables. So, they set out a goal for collecting insects and they said targets for collecting insects. And it turns out, their employees end up starting carrying insects around with them in their pockets that they put in to the vegetables so they could take them out later to hit their goals of number of insects pulled out of vegetables. Now, MiniScribe in the 1980's they had quarterly earnings. They had goals to ship enough products and they found out their employees were actually shipping not just products, but also bricks. Because they were trying to hit these goals in a very narrow sense. Sears automotive in the 1990s, they set a goal for certain billable hours they wanted $147 in bill of sales per hour. They found the staff overcharged for work and made unnecessary repairs. And undercover investigations they found that a vast number of Sears automotive employees were suggesting unnecessary work. And it damage to reputation for years. My own experiments with my colleagues have demonstrated that when people have specific challenging goals and they fail to meet those goals, they'll often cheat. In this case they were checking their own work to hit that goal. So, across several domains we've seen goals led to very undesirable outcomes. And I'll share one other example here. The Atlantic School Superintendent Beverly Hall In 2009, she was heralded for the National Superintendent of the Year award. So here's someone who is held up as an example for others to follow. And they had 50,000 students' standardized tests starting in 2001 and she was able to boost performance in Atlanta. Now, it turns out what she'd done is she had pushed goals on educators to produce these great achievement goals. But when state investigators looked into this performance, they determined that cheating had occurred in more than half the districts. Over 180 teachers were implicated in this scandal. That is, teachers who were cheating on standardized tests on behalf of the students to hit performance goals so they could meet these marks. So goals can push us to do things that are very undesirable. Taken together, we can see that goals can promote unethical behavior. They can promote unethical behavior by guiding people to use unethical means to meet that goal. So like Wells Fargo employees opening up accounts that customers didn't ask to create. And we can also see people misrepresenting their performance to meet the goal. So they're saying they met the goal even when they didn't. In both cases, goals are motivating people, but they're motivating people to cut corners in ways that can have disastrous consequences, both for individuals, groups, and organizations.