APPLIED PSYCHOLOGY: AN INTERNATIONAL REVIEW, 2006, 55 (4), 606623

LATHAM Original GOALS and Article and SATISFACTION BROWN Blackwell Oxford, Applied APPS 0269-994X xxx XXX International 2006 UK Psychology: Publishing Association an LtdInternational for Applied Psychology, 2006

The Effect of Learning vs. Outcome Goals on Self-Efcacy, Satisfaction and Performance in an MBA Program
Gary P. Latham*
University of Toronto, Canada

Travor C. Brown
Memorial University of Newfoundland, Canada
Dans cette exprience de terrain, on applique la thorie de la xation des objectifs au sentiment defcacit personnelle dtudiants, leur satisfaction envers le programme du MBA aussi bien qu leur performance (GPA). Immdiatement aprs leur avoir x des objectifs spciques levs, nous avons mesur le sentiment defcacit personnelle des tudiants en MBA. Celui des tudiants de la condition objectifs de rsultats pour la n de lanne (long terme) tait infrieur celui de sujets qui taient dans la condition faites de votre mieux ou dans celle but dapprentissage. Les sujets prsentant des difcults spciques en ce qui concerne les buts dapprentissage sont plus satisfaits du programme MBA que ceux des autres conditions exprimentales. Le GPA tait signicativement plus lev dans la condition but dapprentissage que dans celle but de performance long terme. Les sujets qui ont des objectifs court terme et un objectif de rsultat long terme ont un GPA plus lev que ceux qui ont seulement un objectif long terme ou que ceux qui sont dans lurgence de faire de leur mieux. Les implications de ces rsultats pour la thorie et la pratique sont discutes. The present eld experiment examined the application of goal setting theory on student self-efcacy, satisfaction with the MBA program, as well as performance (i.e. GPA). Immediately after setting specic high goals, the selfefcacy of MBA students who set year end (distal) outcome goals was lower than participants in either the do your best or the learning goal conditions. Participants who set specic difcult learning goals had higher satisfaction with the MBA program than those in other experimental conditions. GPA was signicantly higher in the learning goal condition relative to the distal performance goal condition. Participants who set proximal goals, in addition to a distal outcome goal, had a higher GPA than those who only set a distal
* Address for correspondence: Gary P. Latham, Rotman School of Management, University of Toronto, Toronto, Ontario, Canada M5S 3E6. Email: latham@rotman.utoronto.ca This study was funded in part from a Social Sciences and Humanities Research Council of Canada (SSHRC) grant to the rst author. 2006 The Authors. Journal compilation 2006 International Association for Applied Psychology. Published by Blackwell Publishing, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA.

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goal or those who were urged to do their best. Implications of these ndings for theory and practice are discussed.

INTRODUCTION
Job satisfaction and performance are the two most frequently studied dependent variables in industrial-organisational psychology (Latham & Budworth, in press; Weiss & Brief, 2002). Given the aging workforce, the expectations of recent recruits, and the difculties in recruiting and retaining skilled employees in the technology and medical sectors of the economy, many organisations in Asia, Europe, and North America are focusing on the issue of employee satisfaction in their effort to become an employer of choice (Lee, 2005; Manitoba Employer of Choice, 2005; Maughan, 2003). Both Fortune magazine and The Times include measures of employee satisfaction in determining their rankings of the 100 Best Companies to Work for (Levering & Moskowitz, 2005; Times, 2005). Not only is the issue of satisfaction important to businesses, it is also important to business schools for at least two reasons. First, if people do not like the education that they receive, they may not recommend the school to others. Second, similar to the rankings of employers by outside media, the news media in Canada, the United Kingdom, and the United States rate and rank MBA programs. Many of these rankings take into account feedback from past and present students (e.g. Business Week, 2004; Canadian Business, 2004). Consequently, student satisfaction affects the ranking of an MBA school. Thus, business school deans are under ongoing pressure to nd ways to increase the satisfaction of the participants in their MBA programs. The dysfunctional effects of media rankings of MBA programs on business school deans have been described elsewhere (Goia & Corley, 2002). A positive outcome, however, can be the willingness of business school faculty to use theory and empirical research to explore systematically ways of making the educational process a memorable and meaningful experience for students. In doing so, faculty are able to demonstrate to students the relevance of theory as a framework for guiding behavior. Thus, it is a reminder to both deans and students of the timelessness of Lewins (1951) dictum: There is nothing so practical as good theory. The philosophy of the business school in which the present study was conducted is to de-emphasise grades. The rationale for this decision is two-fold. First, the admission criteria require a high undergraduate grade point average (GPA) as well as a high GMAT (m = 650). Thus, students who are academically competent are admitted into the MBA program. The probability of the students becoming less competent within the subsequent two-year time span required for the MBA degree has been judged by the business school administration to be low. Almost all the students graduate from the MBA program with grades
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ranging between B+ and A. Second, the previous emphasis on grades dispensed in the MBA program has been judged by the faculty to be a causal variable for high anxiety among students, as well as dysfunctional behavior that resulted in poor teamwork skills. Support for these latter two assessments has been articulated by Pfeffer (1998) and Pfeffer and Fong (2002).

Goal Setting Theory and Satisfaction

The primary purpose of the present study was to demonstrate to students the value of theory for designing an intervention for increasing and explaining satisfaction, namely their own, regarding their rst year in the MBA program. The theory chosen by the authors was Locke and Lathams (1990, 2002) theory of goal setting. Numerous reviews of the literature have concluded that this is among the most valid and practical theories of motivation in organisational psychology (e.g. Lee & Earley, 1992; Miner, 1984; Pinder, 1998). Among the tenets of this theory is that setting a specic, high goal leads to higher performance than setting no goal or even an abstract goal such as urging people to do their best. In the more than 500 studies on goal setting, the vast majority, however, have focused on performance rather than satisfaction. Half a century ago, Lewin (1958) argued that an individual experiences feelings of success and failure not on the basis of the absolute level of performance attained, but rather on performance in relation to ones personal standard. To the extent that the standard is met or exceeded, the person experiences satisfaction. Nevertheless, few issues continue to be misunderstood in the organisational psychology literature more than the relationship between goals and affect. Goal setting theory states that emotions are a function of ones actions and the subsequent outcomes (e.g. summer internship, salary level) from working toward and/or attaining ones goals. When one perceives ones actions as effective (i.e. goal attainment), one experiences satisfaction. Conversely, if the action is viewed as ineffective (i.e. ones goals are not attained), one experiences dissatisfaction. Social cognitive theory (Bandura, 1986) states that a high degree of dissatisfaction occurs when people lack the condence that a valued goal can be attained. In fact, it can lead to self-belittlement and even depression (Bandura, 1986). Observations by the faculty indicated that low self-condence is typical for some in-coming MBA students. While students often enter the program with high condence given their high undergraduate GPA and high GMAT score, their condence level can quickly drop given their unfamiliarity with the tasks at hand. Specically, they learn that the task performance expectations of the MBA program as well as the competency level of their fellow students is much higher than in their past undergraduate program. As such, students self-efcacy, or task specic condence (Bandura, 1997), was measured in this study.
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Goal setting was used as the intervention in the present study because it has a positive effect on interest by providing people with a sense of purpose (Latham & Kinne, 1974; Locke & Bryan, 1967). It is a strong variable that masks individual differences (Adler & Weiss, 1988). It has been shown to be effective on more than 88 different tasks ranging from logging to conducting research (Locke & Latham, 1990, 2002). In addition, goal setting engages people by challenging them to see how well they can do. As Gould (1939) and White (1959) observed years ago, people have the desire to accomplish that which is of importance to them. Satisfaction is determined, as noted earlier, by the degree of success in attaining ones goal. The greater the signicance or importance of goal attainment to the individual, the greater the satisfaction (Locke & Latham, 1990). Thus the implicit hypothesis of this eld experiment is that people will be satised with their MBA program to the extent that they are satised that their goals are being met. Because goal setting is a theory of motivation (Locke & Latham, 2002), the majority of studies, as noted earlier, have focused on performance rather than affect. Findings from these performance-based studies suggest two impediments that might mitigate the positive effects of goals on a persons satisfaction, namely, lack of ability and environmental uncertainty. Kanfer and Ackerman (1989) found that when ability is an issue for effective performance, that is, when people must acquire the requisite knowledge or skill before they can perform the task, the setting of a specic high outcome goal has a deleterious effect on performance. In such cases, people who are urged to do their best perform better than their goal setting counterparts. One potential explanation for this negative goal setting effect is low self-efcacy, that is, low condence that a specic desired performance outcome can be attained. Winters and Latham (1996) replicated Kanfer and Ackermans experiment. They too found that urging people to do their best led to higher performance on a task that was complex for them than the setting of a specic challenging outcome goal. Again, people did not possess the necessary knowledge or skill to perform the task effectively. However, Winters and Latham also found that this deleterious goal setting effect was not due to a limitation or boundary condition of goal setting theory, but rather, to the type of goal that was set. Specically, they found that setting a specic, difcult learning goal (e.g. discover a specic number of strategies or procedures to perform the task correctly) on a task that requires the acquisition of knowledge before it can be performed properly, led to higher performance than did urging people to do their best, or setting a specic high outcome goal. They also found that learning goal participants had higher self-efcacy than those people who had been urged to do your best (DYB). Satisfaction, however, was not measured. Environmental uncertainty can be a second impediment to the normally positive motivational effects of setting an outcome goal on performance. In
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such situations, the information necessary to set a specic difcult outcome goal may quickly become obsolete due to rapid changes in the environment. For example, Earley, Connolly, and Ekegren (1989) found that business students who were urged to do their best on a stock market prediction task, for which they had yet to acquire the necessary knowledge to perform effectively, performed better than those who were assigned a specic challenging outcome goal. Latham and Seijts (1999) replicated this nding using an assessment center exercise where high school students were paid on a piece-rate basis to make toys, and the dollar amounts paid for the toys changed continuously without warning. The negative effect of goals on performance, however, was caused by the type of goal that was set. When participants set proximal outcome goals, in addition to the distal goal, that is, when short-term or sub-goals were set in addition to the long-term goal, their self-efcacy and prots were signicantly higher than both the DYB goal condition and the distal outcome goal condition. There are two explanations for the effectiveness of proximal plus distal goals. First, proximal goals can improve performance during times of uncertainty in that they often improve error management (Frese & Zapf, 1994). Errors provide people with information on the extent to which their picture of reality is congruent with goal attainment; they also facilitate the discovery of the strategies needed to accomplish the task. Second, as argued by Bandura (1997), proximal goals can bolster self-efcacy because their attainment is an early mark of accomplishment. As people experience these small wins, they increase their self-efcacy that they can attain their distal goal. Moreover, short-term proximal goals often provide participants with the feedback necessary to discover strategies to attain their distal goal. Again, satisfaction was not measured in these studies. Although the goalperformance relationship has been found repeatedly in eld experiments (Latham, 2001), the ndings with regard to satisfaction have been mixed. For example, Ivancevich found a positive relationship in studies involving salespeople (Ivancevich, 1976), technicians (Ivancevich, 1977), and engineers (Ivancevich & McMahon, 1982). Null effects were obtained in studies involving engineers/scientists (Latham, Mitchell, & Dossett, 1978), die cast workers (Adam, 1975), salespeople (Kim, 1984), and school-aged children (Gaa, 1973). Latham and Yukl (1976), in a eld experiment involving word processing operators, found that a distal outcome goal decreased job satisfaction even though productivity increased. Koch (1979) obtained similar ndings in a study of sewing machine operators. However, none of the participants in these studies set specic high learning goals or the combination of a distal outcome goal that included sub-goals. The overall hypothesis of the present study was that the type of goal set inuences both self-efcacy and a persons satisfaction. Thus, the primary purpose of the present study was to assess the relative effectiveness of urging
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MBA students to: (a) do their best versus, (b) set a specic challenging learning goal, (c) a distal outcome, or (d) a distal outcome goal that includes proximal goals on the self-efcacy and satisfaction of students during their rst year in the MBA school. Because of the competitive nature of MBA students, as well as the use of GPA as a screening criterion used by recruiters, GPA is important to many students. Consequently, we also included performance (i.e. GPA) as a dependent variable. We explained to the students that to our knowledge, no study had ever examined the relative effectiveness of distal outcome, distal plus proximal outcome, versus specic difcult learning goals in a eld setting; and that this is among the few studies to use satisfaction as a dependent variable to test the effect of goal setting theory. We then discussed the rationale of another timeless dictum of Kurt Lewins, namely, no research without action, no action without research.

METHOD

Sample
Full-time MBA students (n = 125) in a Canadian university were randomly assigned to one of the four conditions described below. The typical participant was a 28-year-old with four years of work experience. Seventy-seven were North American, 29 were Chinese, seven were Italian, six were East Indian, ve were Israeli, and one was Swedish. Fifty-eight per cent of them were male. Because the MBA program requires that all students receive the same foundation year, all of them took the same courses, were taught by the same faculty, received the same assignments, and took the same examinations. Thus, the environment in which the study was conducted was relatively constant across conditions.

Procedure
Pre-study Information. Prior to the start of the study, the Dean addressed all the students. His comments were transcribed and distributed to the participants in all four goal setting conditions. He emphasised the importance for the students to maximise their MBA experience in as many ways as possible, and to take full advantage of the opportunities in the business school available to them. In the rst week of classes, the participants were invited to take part in an activity designed to enhance their experience in the MBA program.
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Consistent with the human subjects procedures of the university where the present study took place, all students were informed that they had the right to participate, or not participate, in any part of the study. All of the students agreed to participate. No extrinsic incentives were offered to the participants. Participants in each condition met together for 45 minutes. Distal Outcome Goals. Participants (n = 32) were informed that high effort on their part should result in a highly positive and productive academic experience. They were asked to articulate to their study condition peers why they decided to join the MBA program. They were then requested to set 35 specic, difcult goals that they wished to attain by the end of their academic year in order for them to be satised with the MBA program. Typical goals included grade point average, number of rsums to be sent for getting a summer job relevant to their career aspirations, as well as the desired summer job or salary level. In groups of 57 people, they explained the rationale for their distal goals. Students then critiqued each others goals by asking each other the extent to which their goals were specic and difcult. Participants were informed that they were free to change their goals based on feedback from their peers. The public discussion of goals is consistent with the recommendation of Hollenbeck, Williams, and Klein (1989). A research assistant met with each participant to ensure that the goals were distal outcomes. At the end of this 45 minute session, self-efcacy for goal attainment was assessed. Distal Plus Proximal Outcome Goals. This condition was identical to the distal outcome goal condition except that the participants (n = 29) were also asked to set proximal outcome goals that they wished to attain by the end of the rst, as well as the second, semester of their rst year in order for them to be satised with the MBA program. There was also peer discussion of goals, as well as a review of the goals by a research assistant to ensure that they were performance outcomes. Participants were informed that proximal goals would serve as benchmarks for them to assess their progress in attaining their 35 distal goals. The distal goals were identical to those set by participants in the distal goal only condition. Sample proximal goals included grade point average for mid and end of term as well as the number of job leads to follow up on by the middle and end of each term. Learning Goals. This condition was identical to the other goal conditions with the exception that participants (n = 32) generated 35 specic strategies or processes that would enable them to be satised with their MBA program at the end of the academic year. A research assistant
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reviewed each persons goals to ensure that they were process-oriented. Examples of learning goals included generating specic ways of mastering knowledge in course work for which they had an initial fear or dislike, learning the rationale underlying viewpoints from colleagues and faculty that were different from their own, and developing ways to network for a job search. Do Your Best (DYB) Goals. Consistent with previous research, no specic performance or learning goal was set (e.g. Seijts & Latham, 2001; Latham & Seijts, 1999; Winters & Latham, 1996). Rather, the participants (n = 32) were informed, as was the case in the previous three conditions, that high effort usually results in a highly positive and meaningful academic experience. They were asked to think of why they decided to join the MBA program. This was followed by a group discussion. Consistent with previous goal setting studies (see reviews in Locke & Latham, 1990, 2002), they were then urged to do their best to nd ways to ensure that their education experience was meaningful and satisfying for them.

Measures
Key measures in this study were satisfaction, self-efcacy, and GPA. GPA was assessed on a 4-point scale, at the end of the academic year. Consistent with previous goal setting studies (see review in Locke & Latham, 1990), all participants were given a self-efcacy questionnaire immediately after the goal setting intervention, and again at the end of the academic year. Self-efcacy assessed a persons belief that (s)he could attain his/her goals in the MBA program. Specically, self-efcacy was measured in terms of obtaining 1/4, 1/2, 3/4, all, or even exceeding ones goals of the MBA program (yes/no) as well as ones condence in ones ability to do so (10-point scale). The construction of this scale was consistent with the recommendations of Lee and Bobko (1994). At the end of both the rst semester and the academic year, a persons satisfaction with the MBA program was assessed using a 12-item scale developed specically for this study. This was done prior to the distribution of nal grades so as to minimise the confounding of grade satisfaction with MBA program satisfaction. None of the questions directly assessed satisfaction with grades or grading processes. Sample items included the following: (a) I would recommend this MBA program to others; (b) if I had my time back, I would not have joined this program (reverse-scored); and (c) overall I am satised with this program. All items were assessed using a 5-point Likert-type scale where 1 = strongly disagree and 5 = strongly agree.
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RESULTS
The variables of interest in this study to the business schools administration were the students self-efcacy and satisfaction. The means and standard deviations of these two variables, as well as GPA, and the inter-correlations are presented in Table 1.

Self-efcacy
A self-efcacy composite score was created by summing the raw scores for self-efcacy strength (10-point scale) when the corresponding self-efcacy magnitude was equal to yes. Lee and Bobko (1994, p. 368) suggested that this is the measure of choice as it is less cumbersome than calculating selfefcacy through z-scores. The internal consistency of this scale was satisfactory. The Cronbachs alphas were .72 and .75, respectively, for the measures taken immediately after goal setting and at the end of the academic year. The test-retest reliability was .33. The correlation between self-efcacy and satisfaction at the end of the academic year (r = .31, p < .01) was signicant. The correlation between self-efcacy and GPA at the end of the year was also signicant (r = .26, p < .05). This was not the case at the end of the rst semester. Feedback regarding nal grades at the end of the rst semester, an indicator of enactive mastery, likely explains the positive correlation between self-efcacy and GPA at the end of the year. The means and standard deviations of initial self-efcacy and self-efcacy at the end of the academic year are presented in Table 2. The maximum self-efcacy score was 50 as self-efcacy was measured using ve items (i.e. condence that one could achieve 1/4, 1/2, 3/4, all, or even exceed ones goals). Each item was assessed on a 10-point scale. The time 1 mean of 38.03 (SD = 7.36) was close to 40 (or the fourth anchor of meeting all of my goals) while the mean at time 2 (M = 29.70, SD = 8.34) was close to 30 (or the third anchor of meeting 3/4 of my goals). Of the original sample of 125, three failed to complete the self-efcacy questionnaire at the beginning of the study. ANOVA of initial self-efcacy (n = 122), measured immediately after the goals were set at the beginning of the academic year, revealed a signicant main effect for goal condition (F3,118 = 3.70, p < .05). There was no signicant difference in self-efcacy between the learning goal and the do your best conditions. Planned twotailed independent t-tests revealed that the MBA students in the learning (t62 = 2.68, p < .01) and do your best (t62 = 2.98, p < .01) conditions had higher self-efcacy than those in the distal outcome goal condition. The difference between the distal outcome goal condition that included proximal goals versus the distal outcome goal only condition was not signicant (t56 = 1.57, p > .05).
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TABLE 1 Key Variables: Means, Standard Deviations, and Correlations

Initial self-efcacy 1.00 .33** .27* .10 .04 End of academic year self-efcacy End of semester 1 satisfaction End of academic year satisfaction End of academic year GPA

Variable Initial self-efcacy End of academic year self-efcacy End of semester 1 satisfaction End of academic year satisfaction End of academic year GPA
Notes: * = signicant at p < .05; ** = signicant at p < .01; *** = signicant at p < .001.

Mean 38.03 29.70 45.65 44.58 3.44

SD 7.36 8.34 4.88 5.22 .18

1.00 .05 .31** .26*

1.00 .47*** .04

GOALS AND SATISFACTION

1.00 .11

1.00

615

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LATHAM AND BROWN TABLE 2 Self-Efcacy Means and Standard Deviations

Distal outcome goal Mean SD 8.25 8.74 (n) 32 21 Proximal + distal goal Mean 38.00 30.07 SD 7.99 7.22 (n) 26 14

Learning goal Mean 39.53* 31.53 SD 6.24 8.42 (n) 32 21

Do your best (DYB) Mean 39.97* 31.05 SD 5.89 8.61 (n) 32 21

Time 1 Time 2

34.63 27.00

Note: At time 1, learning and do your best conditions had higher self-efcacy than distal performance goal condition.

The number of surveys returned at the end of the academic year was 82 (response rate = 65.6%). Of these 82 surveys, three did not have the selfefcacy questionnaire completed, hence 79 surveys were useable (63.2% of initial sample). ANCOVA, using self-efcacy at the beginning of the academic year as the covariate, did not reveal a signicant main effect (F3,72 = .56, p > .05) for self-efcacy at the end of the academic year. While a survey response rate of 65.6 per cent is considered good (Kervin, 1992), we conducted an analysis to see if the participants that completed the end of academic year survey differed from those that did not do so in terms of initial self-efcacy. A planned two-tailed independent ttest revealed no signicant difference (t120 = 1.82, p > .05). Non-respondents were spread relatively evenly across the four study conditions with 11 to 12 non-respondents per condition.

Satisfaction
The number of satisfaction surveys received at the end of the rst semester was 82 (65.6%). Again, analyses were conducted to see if the participants that did and did not complete the end of semester survey differed in initial self-efcacy. A two-tailed t-test found no signicant difference between these two groups (t120 = .55, p > .05). Again, non-respondents were spread relatively evenly across conditions. Cronbachs alpha for the 12-item measure of satisfaction was .75 at the end of the rst semester, and .78 at the end of the academic year. The testretest reliability was .47. The means and standard deviations for satisfaction at the end of the rst semester and at the end of the academic year are presented in Table 3. The relationship between satisfaction with the program and the persons GPA was not signicant. There were no signicant differences in satisfaction among the different goal setting conditions at the end of the rst semester (F3,78 = .65, p > .05).
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GOALS AND SATISFACTION TABLE 3 Satisfaction Means and Standard Deviations

Distal outcome goal Mean Time 1 Time 2 44.68 44.95 SD 4.77 4.08 (n) 22 21 Proximal + distal goal Mean 46.74 45.03 SD 5.73 6.19 (n) 17 17

617

Learning goal Mean 46.09 46.43* SD 4.28 4.29 (n) 22 22

Do your best (DYB) Mean 45.31 42.32 SD 4.98 5.63 (n) 21 22

Note: At time 2, learning goal condition had signicantly higher satisfaction compared to do your best condition.

TABLE 4 End of Academic Year GPA Scores

Proximal + distal goal Mean 3.54* SD .18 (n) 28

Distal outcome goal Mean 3.34 SD .18 (n) 29

Learning goal Mean 3.47* SD .18 (n) 31

Do your best (DYB) Mean 3.42 SD .13 (n) 32

Note: Proximal + distal goals resulted in a signicantly higher GPA than DYB goals or distal outcome goals. Learning goals led to a higher GPA than setting distal outcome goals.

However, this was not true at the end of the academic year. ANCOVA, using the rst semester satisfaction measure as the covariate, revealed a signicant main effect (F3,57 = 3.36, p < .05). Planned t-tests revealed that only people with learning goals had signicantly higher satisfaction than those who were urged to do your best (t42 = 2.73, p < .01).

GPA
GPA was unavailable for ve students who withdrew from the program. Thus, analyses were made of 120 participants (96% of initial sample). At the end of the academic year, there was a main effect for study condition on GPA (F3,116 = 7.15, p < .001). Table 4 presents the means and standard deviations. Planned t-tests revealed that the setting of a distal outcome goal did not lead to a signicantly higher GPA than urging people to do their best (p > .05). But, setting a distal outcome goal that included proximal goals resulted in a signicantly higher GPA than a vague DYB goal (t58 = 3.17, p < .01), or setting a distal goal only (t55 = 4.15, p < .001).
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Setting specic learning goals led to a higher GPA than setting distal outcome goals (t58 = 2.66, p < .01). The GPA of those who set proximal and distal goals was not signicantly different from that of the people who set learning goals. In summary, only learning goals resulted in signicantly higher satisfaction at the end of the academic year than that of the people who were urged to do their best. With regard to performance, GPA was signicantly higher in the learning goal than in the distal goal condition. Students who set proximal and distal outcome goals, however, had a GPA that was as good as those who set a specic learning goal.

DISCUSSION
The practical signicance of this study for deans of business schools is fourfold. First, exhortations on their part in an orientation program for MBA students to take full advantage of the experiences available to them and to maximise an understanding of business in a global economy is too abstract and too general to have a positive effect on the students subsequent satisfaction with the MBA program. Moreover, a do your best mindset does not provide an explicit standard for self-evaluation. Such a standard is usually necessary to preclude feelings of doubt about that which is possible on the basis of ones cognitive ability and effort, a precursor of level of satisfaction (Greenberger, Strasser, Cummings, & Dunham, 1989; Liden, Ferris, & Dienesch, 1988). Second, worse than urging students to do their best is urging them, in an orientation program, to set specic challenging distal outcome goals. Doing so can decrease rather than increase the persons initial self-efcacy that the goals are attainable. This nding is consistent with the goal orientation literature on performance in educational psychology involving children. Dweck (1986) found that when individuals have yet to master the task, a focus on the end result rather than the process for attaining it increases apprehensions of both failure and the disapproval from signicant others. That differences in self-efcacy among conditions disappeared at the end of the academic year in the present study likely reects the time period in which the measure was taken, namely, days before the nal examinations. Physiological arousal in the form of high anxiety was likely constant across conditions. Nevertheless, differences in self-efcacy correlated with both end of year satisfaction with the program and GPA, ndings that are consistent with social cognitive theory (Bandura, 1986). Third, the setting of learning goals as well as distal outcome goals that include proximal goals led to a higher GPA than the setting of distal outcome goals only. Proximal outcome goals appear to be particularly benecial on tasks that are complex for people because of uncertainty
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(Latham & Seijts, 1999). In an MBA program, the tasks are designed to be complex and ambiguous for most people. Fourth, there was no signicant difference between the GPA levels of participants who set learning versus those who set distal outcome goals that included proximal goals. However, deans may be well advised to encourage students to set learning goals in order to ensure satisfaction with an MBA program. Because this was a eld experiment, problems due to diffusion/contamination could not be eliminated. All the participants knew the importance that the school placed on their satisfaction. This could have led to demand effects which in turn could have led to restriction of range across conditions. All of the participants in the DYB condition were aware of the goal setting treatments. Thus those in the DYB condition could have set specic high learning, distal, or distal plus proximal goals. Despite these limitations common to eld experiments, signicant differences between conditions emerged that are consistent with those obtained in laboratory as well as eld experiments on performance (Latham et al., 1978; Latham & Seijts, 1999; Seijts & Latham, 2001; Winters & Latham, 1986). That learning goals increased satisfaction with the MBA program is also consistent with the overall ndings of a review of the literature on job satisfaction. Judge (2000) found that mentally challenging work is the key to a persons satisfaction. Hence, he argued that the most effective way to promote job satisfaction is to enhance the mental challenges in a job. On tasks that are complex for people, and hence represent a mental challenge, setting specic difcult learning goals necessitates a focus on specic ways to increase their understanding of what is required of them rather than focusing on a specic performance outcome. Based on the results of the present study, the setting of learning goals, by its very nature, appears to have focused the students attention on developing ways to address the mental challenges of performing well in the business school which, in turn, increased satisfaction. The practical signicance of this study for both faculty and students is at least two-fold. First, it facilitates demonstration to students of the benet of drawing upon theory for conducting empirical research to resolve differences in opinion. Rational arguments, based on the goalperformance literature, were made in discussions with students, prior to the study, for the benets that could be anticipated from each goal setting condition. As such, participants viewed the goalsatisfaction relationship as a question to be answered through empirical research. Moreover, the results of the study allowed faculty to show students the similarities and differences that can occur when one attempts to increase a dependent variable (i.e. satisfaction) different from that which was the focus in previous studies (i.e. performance). Second, conducting this study also demonstrated to the MBA students the direct benets that research in organisational psychology can have on
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the lives of others; in this instance, their own. The results of this study demonstrated what they themselves can do to increase their satisfaction with their education in the MBA school. Several limitations of the study were discussed with the students. This was done to demonstrate how the ndings from one study can lead to subsequent research. First, the possible impact of moderators was explained. For example, it may be likely that setting specic challenging learning goals increases satisfaction only when the task requires explicit planning (McNamara, Telzrow, & Delamatre, 1999). Moreover, the context in which this eld experiment took place may be a factor that limits the generalisability of the ndings. Would similar results be found in a different organisational environment (e.g. manufacturing)? A second limitation of this study is that the goal orientation of the participants was not measured. However, Seijts, Latham, Tasa, and Latham (2004) found that this measure should be treated as a state rather than a trait, and that its effect on performance is masked by a specic, high learning goal. While the response rate of approximately 65 per cent is considered good (Kervin, 1992), a third limitation of this study is the potential of non-response bias. Survey non-response bias is a problem in North America and internationally. Numerous studies (Bradley & Cartwright, 2002; Tourangeau, 2004) have highlighted the problem of survey fatigue. Similarly, there is evidence concerning survey fatigue in academic settings (Porter, Whitcomb, & Weitzer, 2004). In the present study, surveys were distributed during the last week of classes when students were nishing papers and preparing for nal examinations. While we could not nd any differences between respondents and non-respondents in terms of time 1 measures, the issue of survey non-response bias cannot be ruled out. In closing, the results of this study suggest that the dysfunctional effects of business school rankings (Pfeffer & Fong, 2002) may be offset when faculty apply their research skills to nd ways to improve the satisfaction of students with their education. Moreover, the external validity of results from laboratory experiments on setting specic high learning goals on performance (Seijts & Latham, 2001; Winters & Latham, 1996) was shown in a eld setting using a different dependent variable, namely satisfaction. In addition, the external validity of proximal plus distal goals has been shown for the rst time in an educational setting.

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