The Impact of Goal-setting on Worker Performance - Empirical Evidence from a Real-effort Production Experiment

Abstract

This paper examines the influence of goal-setting on worker performance in an industrial production process. For empirical examination, we conducted a real-effort experiment at the Training Factory for Energy Productivity at the Technische Universität München. The participants’ performance was measured by checking for quantity and quality of the assembled products and furthermore by recording the consumed compressed air per finished good. In total four groups were defined, each group in a different experimental setting. This experiment is the first one ever conducted related to goal-setting in an industrial production setting and thus adds valuable results to academia and practitioners in the field of sustainable manufacturing. The major results are that even without financial incentives goal-setting improves worker performance by 12 to 15% compared to the situation where no goals were defined. This holds true for the groups which had to maximize either output quantity or output quality, as well as for the group which was obliged to be as energy efficient as possible.