A$-$Z Goal Setting and Planning $($Scenario$)$

Organizations ABC and $xYZ$ are both in the same industry and vie for the same set of customers in the marketplace. At ABC, goals are set at the top level of management each year and then broken into subgoals for each organizational level. Similarly, plans are developed at the top level and then reformulated and delegated to managers at the middle and lower levels. At XYZ$,$ goals are developed at the top level, and then those managers meet with their subordinates at the next lower level to establish mutually agreeable goals. The middle managers then meet with the first$-$level managers to establish mutually agreeable goals. Finally, the first$-$level managers meet with each of their employees and establish mutually agreeable goals. Annual plans are then developed by organization members at all levels to meet their specific needs.

Which organization is most likely to achieve the highest level of employee performance and organizational productivity?

ABC because the plans are formulated by management for each level of the organization

XYZ because the goals are set participatively with employees

both because the hierarchy of organizational goals is clearly defined at each level

neither because they both use goals to control employees rather than to motivate them