Management by Objectives

Management by ObjectivesMBO

Management by Objectives (MBO)

Can be defined as a process whereby the performance goals and objectives are set by each subordinate in collaboration with his superior at the start of the appraisal period.

MBO is a Process


A process consisting of a series of interdependence and interrelated steps:
 The formation of clear, concise statements of objectives
 The development of realistic action plans for their attainment,
 The systematic monitoring and measuring of performance and achievement, and
 The taking of corrective actions necessary to achieve the planned results THE MBO PROCESS

Define
Organisational
goals

Defining
Employee
Objectives and
Organisational
Objectives

Reporting &
Reviewing

Continuous
Monitoring of performance and progress

Providing
Feedback

Performance
Evaluation &
Review

MBO is a Philosophy


Reflects a Proactive way of managing that is
Result Oriented
Emphasizes accomplishments rather than inputs
Encourages participation at all levels of and organisation



Objectives setting and participative management are integrally linked by :
 Allowing employees to participate in the setting of objectives
 Encouraging everyone to work towards accomplishment of general organisational objectives

MBO Framework






MBO provides the basis for making functional budget estimates
Evaluation of MBOs provides a way to communicate purpose & accomplishments to the public.
MBO provides a way to involve and motivate staff.

Four Basic Principles


Unity of management action is more likely to occur when there is pursuit of a common

objective






Greater the focus on results on a time scale, greater the likelihood of achieving them Greater the participation in setting meaningful work with accountable results, greater the motivation for completing it
Progress can only be measured in terms of
what