Management Past Times Objectives (Mbo) - Peter Drucker Mbo

The Concept Of Management By Objectives (MBO)

The concept of MBO is closely connected amongst the concept of planning. The procedure of planning implies the being of objectives as well as is used every bit a tool/technique for achieving the objectives. Modern managements are rightly described every bit 'Management past times Objectives' (MBO). This MBO concept was popularized past times Peter Drucker. It suggests that objectives should non hold upward imposed on subordinates but should hold upward decided collectively past times a concerned amongst the management. This gives pop back upward to them as well as the achievement of such objectives becomes slow as well as quick.

Management past times Objectives (MBO) is the most widely accepted philosophy of management today. It is a demanding as well as rewarding fashion of management. It concentrates attending on the accomplishment of objectives through participation of all concerned persons, i.e., through squad spirit. MBO is based on the supposition that people perform meliorate when they know what is expected of them as well as tin relate their personal goals to organizational objectives. Superior subordinate participation, articulation destination setting as well as back upward as well as encouragement from superior to subordinates are the basic features of MBO. It is a result-oriented philosophy as well as offers many advantages such every bit employee motivation, high morale, effective as well as purposeful leadership as well as clear objectives earlier all concerned per-sons.

MBO is a participative as well as democratic fashion of management. Here, ample a range is given to subordinates as well as is given higher condition as well as positive/participative role. In short, MBO is both a philosophy as well as approach to management. MBO concept is dissimilar from MBC (Management past times Control) as well as is also superior inwards many respects. According to the classical theory of management, exceed management is concerned amongst objectives setting, directing as well as coordinating the efforts of middle grade managers as well as lower grade staff. However, achievement of organizational objectives is possible non past times giving orders as well as instructions but past times securing cooperation as well as participation of all persons. For this, they should hold upward associated amongst the management process. This is possible inwards the representative of MBO as well as so MBO is dissimilar from MBC as well as also superior to MBC.

MBO is an approach (to planning) that helps to overcome these barriers. MBO involves the institution of goals past times managers as well as their subordinates acting together, specifying responsibilities as well as assigning ascendency for achieving the goals as well as finally constant monitoring of performance. The genesis of MBO is attributed to Peter Drucker who has explained it inwards his majority 'The Practice of Management'.

Definitions Of Management By Objectives MBO :-

1. According to George Odiome, MBO is "a procedure whereby superior as well as subordinate managers of an Organisation jointly define its mutual goals, define each individual's major areas of responsibleness inwards terms Of results expected of him as well as utilisation these measures every bit guides for operating the unit of measurement as well as assessing the contribution of each of its members."
2. According to John Humble, MBO is "a dynamic scheme which seeks to integrate the company's needs to clarify as well as accomplish its profits as well as increase goals amongst the manager's demand to contribute as well as develop himself. It is a demanding as well as rewarding fashion of managing a business."

Features Of Management By Objectives MBO :-

1. Superior-subordinate participation: MBO requires the superior as well as the subordinate to recognize that the evolution of objectives is a articulation project/activity. They must hold upward jointly handgrip as well as write out their duties as well as areas of responsibleness inwards their respective jobs.
2. Joint goal-setting: MBO emphasizes articulation goal-setting that are tangible, verifiable as well as measurable. The subordinate inwards consultation amongst his superior sets his ain short-term goals. However, it is examined both past times the superior as well as the subordinate that goals are realistic as well as attainable. In brief, the goals are to hold upward decided jointly through the participation of all.
3. Joint conclusion on methodology: MBO focuses exceptional attending on what must hold upward accomplished (goals) rather than how it is to hold upward accomplished (methods). The superior as well as the subordinate mutually devise methodology to hold upward followed inwards the attainment of objectives. They also mutually set upward standards as well as constitute norms for evaluating performance.
4. Makes means to attain maximum result: MBO is a systematic as well as rational technique that allows management to attain maximum results from available resources past times focussing on attainable goals. It permits lot of liberty to subordinate to brand creative decisions on his own. This motivates subordinates as well as ensures practiced performance from them.
5. Support from superior: When the subordinate makes efforts to accomplish his goals, superior's helping manus is ever available. The superior acts every bit a coach as well as provides his valuable advice as well as guidance to the subordinate. This is how MBO facilitates effective communication betwixt superior as well as subordinates for achieving the objectives/targets set.

Steps In Management By Objectives Planning :-

1. Goal setting: The commencement stage inwards the MBO procedure is to define the organizational objectives. These are determined past times the exceed management as well as normally inwards consultation amongst other managers. Once these goals are established, they should hold upward made known to all the members. In setting objectives, it is necessary to seat "Key-Result Areas' (KRA).
2. Manager-Subordinate involvement: After the organizational goals are defined, the subordinates operate amongst the managers to determine their private goals. In this way, everyone gets involved inwards the destination setting.
3. Matching goals as well as resources: Management must ensure that the subordinates are provided amongst necessary tools as well as materials to accomplish these goals. Allocation of resources should also hold upward done inwards consultation amongst the subordinates.
4. Implementation of plan: After objectives are established as well as resources are allocated, the subordinates tin implement the plan. If whatever guidance or clarification is required, they tin contact their superiors.
5. Review as well as appraisal of performance: This pace involves periodic review of progress betwixt director as well as the subordinates. Such reviews would determine if the progress is satisfactory or the subordinate is facing unopen to problems. Performance appraisal at these reviews should hold upward conducted, based on fair as well as measurable standards.

Advantages of Management By Objectives MBO :-

1. Develops result-oriented philosophy: MBO is a result-oriented philosophy. It does non favor management past times crisis. Managers are expected to develop specific private as well as grouping goals, develop appropriate activity plans, properly allocate resources as well as constitute command standards. It provides opportunities as well as motivation to staff to develop as well as brand positive contribution inwards achieving the goals of an Organisation.
2. Formulation of dearer goals: Goal-setting is typically an annual feature. MBO produces goals that seat desired/expected results. Goals are made verifiable as well as measurable which encourage high grade of performance. They highlight work areas as well as are express inwards number. The coming together is of minds betwixt the superior as well as the subordinates. Participation encourages commitment. This facilitates rapid progress of an Organisation. In brief, formulation of realistic objectives is me do goodness of M[BO.
3. Facilitates objective appraisal: NIBO provides a dry reason for evaluating a person's performance since goals are jointly set upward past times superior as well as subordinates. The private is given adequate liberty to appraise his ain activities. Individuals are trained to exercise dependent acre as well as self control. Management past times self-control replaces management past times domination inwards the MBO process. Appraisal becomes to a greater extent than objective as well as impartial.
4. Raises employee morale: Participative decision-making as well as two-way communication encourage the subordinate to communicate freely as well as honestly. Participation, clearer goals as well as improved communication volition expire a long means inwards improving morale of employees.
5. Facilitates effective planning: MBO programmes sharpen the planning procedure inwards an Organisation. It compels managers to intend of planning past times results. Developing activity plans, providing resources for destination attainment as well as discussing as well as removing obstacles demand careful planning. In brief, MBO provides meliorate management as well as meliorate results.
6. Acts every bit motivational force: MBO gives an private or group, chance to utilisation imagination as well as inventiveness to accomplish the mission. Managers devote fourth dimension for planning results. Both appraiser as well as appraise are committed to the same objective. Since MBO aims at providing clear targets as well as their gild of priority, employees are motivated.
7. Facilitates effective control: Continuous monitoring is an essential characteristic of MBO. This is useful for achieving meliorate results. Actual performance tin hold upward measured against the standards set downwardly for measuring of performance as well as deviations are corrected inwards time. H5N1 clear set upward of verifiable goals provides an outstanding guarantee for exercising meliorate control.
8. Facilitates personal leadership: MBO helps private director to develop personal leadership as well as skills useful for efficient management of activities of a occupation organisation unit. Such a director enjoys meliorate chances to climb promotional ladder than a non-MBO type.

Limitations of Management By Objectives MBO :-

1. Time-consuming: MBO is time-consuming process. Objectives, at all levels of the Organisation, are set upward carefully subsequently considering pros as well as cons which consumes lot of time. The superiors are required to handgrip frequent meetings inwards gild to acquaint subordinates amongst the novel system. The formal, periodic progress as well as finally review sessions also eat time.
2. Reward-punishment approach: MBO is pressure-oriented programme. It is based on reward-punishment psychology. It tries to indiscriminately forcefulness improvement on all employees. At times, it may penalize the people whose performance remains below the goal. This puts mental delineate per unit of measurement area on staff. Reward is provided just for superior performance.
3. Increases paper-work: MBO programmes innovate sea of paper-work such every bit preparation manuals, newsletters, pedagogy booklets, questionnaires, performance information as well as written report into the Organisation. Managers demand information feedback, inwards gild to know what is just going on inwards the Organisation. The employees are expected to fill upward inwards a let on of forms thus increasing paper-work. In the words of Howell, "MBO effectiveness is inversely related to the let on of MBO forms.
4. Creates organizational problems: MBO is far from a panacea for all organizational problems. Often MBO creates to a greater extent than problems than it tin solve. An incident of tug-of-war is non uncommon. The subordinates seek to set upward the lowest possible targets as well as superior the highest. When objectives cannot hold upward restricted inwards number, it leads to obscure priorities as well as creates a feel of fearfulness amid subordinates. Added to this, the programme is used every bit a 'whip' to command employee performance.
5. Develops conflicting objectives: Sometimes, an individual's destination may come upward inwards conflict amongst those of unopen to other e.g., marketing manager's destination for high sales turnover may discover no back upward from the production manager's destination for production amongst to the lowest degree cost. Under such circumstances, individuals follow paths that are best inwards their ain involvement but which are detrimental to the company.
6. Problem of co-ordination: Considerable difficulties may hold upward encountered spell coordinating objectives of the Organisation amongst those of the private as well as the department. Managers may human face upward problems of measuring objectives when the objectives are non clear as well as realistic.
7. Lacks durability: The commencement few go-around of MBO are motivating. Later it tends to instruct onetime hat. The marginal benefits oft decrease amongst each cycle. Moreover, the programme is deceptively simple. New opportunities are lost because individuals adhere likewise rigidly to established goals.
8. Problems related to goal-setting: MBO tin part successfully provided measurable objectives are jointly set upward as well as it is agreed upon past times all. Problems arise when: (a) verifiable goals are hard to set upward (b) goals are inflexible as well as stiff (c) goals tend to choose precedence over the people who utilisation it (d) greater emphasis on quantifiable as well as easily measurable results instead of of import results as well as (e) over-emphasis on short-term goals at the terms of long-term goals.
9. Lack of appreciation: Lack of appreciation of MBO is observed at dissimilar levels of the Organisation. This may hold upward due to the failure of the exceed management to communicate the philosophy of MBO to entire staff as well as all departments. Similarly, managers may non delegate adequately to their subordinates or managers may non motivate their subordinates properly. This creates novel difficulties inwards the execution of MBO programme.

Essential Conditions for Successful Execution / Implementation of MBO Or...

Q.How To Make MBO Effective?

1. Support from all: In gild that MBO succeeds, it should instruct back upward as well as co-operation from the management. MBO must hold upward tailored to the executive's fashion of managing. No MBO programme tin succeed unless it is fully accepted past times the managers. The subordinates should also clearly sympathise that MBO is the policy of the Organisation as well as they receive got to offering cooperation to instruct inwards successful. It should hold upward a programme of all as well as non a programme imposed on them.
2. Acceptance of MBO programme past times managers: In gild to brand MBO programme successful, it is fundamentally of import that the managers themselves must mentally receive got it every bit a practiced or promising programme. Such acceptances volition choose close deep involvement of managers. If manages are forced to receive got NIBO programme, their involvement volition rest superfluous at every stage. The employees volition hold upward at the receiving-end. They would to a greater extent than oft than non receive got the lines of activity initiated past times the managers.
3. Training of managers: Before the introduction of MBO programme, the managers should hold upward given adequate preparation inwards MBO philosophy. They must hold upward inwards a seat to integrate the technique amongst the basic philosophy of the company. It is but of import to adapt exercise sessions where performance objectives are evaluated as well as deviations are checked. The managers as well as subordinates are taught to set upward realistic goals, because they are going to hold upward held responsible for the results.
4. Organizational commitment: MBO should non hold upward used every bit a decorative piece. It should hold upward based on active support, involvement as well as commitment of managers. MBO presents a challenging task to managers. They must shift their capabilities from planning for operate to planning for accomplishment of specific goals. Koontz rightly observes, "An effective programme of managing past times objective must hold upward woven into an entire blueprint as well as fashion of managing. It cannot operate every bit a dissever technique standing alone."
5. Allocation of adequate fourth dimension as well as resources: H5N1 well-conceived MBO programme requires 3 to v years of performance earlier it provides fruitful results. Managers as well as subordinates should hold upward as well as so oriented that they do non facial expression frontward to MBO for mo solutions. Proper fourth dimension as well as resources should hold upward allocated as well as persons are properly trained inwards the philosophy of MBO.
6. Provision of uninterrupted information feedback: Superiors as well as subordinates should receive got regular information available to them every bit to how good subordinate's destination performance is progressing. Over as well as above, regular performance appraisal sessions, counseling as well as encouragement to subordinates should hold upward given. Superiors who compliment as well as encourage subordinates amongst pay rising as well as promotions supply plenty motivation for peak performance.