Challenge versus threat effects on the goal–performance relationship

This study tested the situational effects of goals and stress on the performance of complex tasks and on adaptation to change in the task. Difficult goals often exceed the individual's resources and thus create stress. However, stress may be appraised as either challenge or threat. Challenge is experienced when there is an opportunity for self-growth with available coping strategies, whereas threat is experienced when the situation is perceived as leading to failure with no available strategies to cope with it. We hypothesized that participants who appraised the situation as a challenge would perform better and adapt better to changes under difficult goal conditions, as compared with general goals or strategy goals. By contrast, threat appraisals would be better addressed by strategy goals rather than difficult goals. One hundred and fifty five students performed a task, which required their making predictions concerning the value of 120 companies' stocks based on three manipulated cues. We used a three by three by two factorial design in which goals, stress, and change (as a repeated factor) were varied to test the hypotheses. Results supported the main hypotheses and demonstrated that the same level of goal difficulty may lead to high or low performance and adaptation to change depending on the appraisal of the situation as challenging or threatening. The theoretical and practical implications of these findings are further discussed.