MANAGEMENT BY OBJECTIVE / MBO

There are two approaches of establishing goals, one is traditional goal setting and other is management by objective. Management by objective is not new, it is a comprehensive managerial system that integrates many key managerial activities in a systematic manner so that objectives may be achieved effectively.

S.P ROBBINS:

“A management system in which specific performance goals are jointly determine by employees and their manager progress toward accomplishing these goals are periodically reviewed, and toward are allocated on the basis of the progress”

BOVEE SAYS:

“A collaborative process in which man

agers and employees set mutually agreeable goals, defines the evaluating individual and group performance”

GENERAL BRIEF DEFINATION

“Set of objectives to achieve wi

thin the specified period of time and budget”

MBO PROGRAM:

Following are the main four ingredients of MBO program. Which are applied lists the steps in a typical MBO program.

1. The organization’s overall object ives and strategies are formatted
2. Major objective are allocated among divisional and departmental units.
3. Specific objective are collaboratively set with all department members.
4. The action plans are implemented
5. Successful achievement of objective is reinforced by performance-based reward
6. Progress toward objectives is periodically reviewed and feedback is provided

GOAL SPECIFICITY

In MBO, goals are important and to the point are specified for each department.

PARTICIPATION IN DECISION MA

KING

Goals are not imposed on employees, but employees and superior set goals while in decision making.

TIME PERIOD

In MBO program, time period is clearly specified in which the work will be completed.

PERFORMANCE FEEDBACK

MBO seeks to give ongoing and continuous feed back on progress towards goals, and giving ongoing feedback to its employees so that they can monitor and correct their activities does it.

THE PROCESS OF MBO PROGRAM

ADVANTAGES:

• Managers know, what is expected of them
• Help in planning
• Better relationship between managers and subordinates
• Element of self control is found
• More person involve in decision-making

DISADVANTAGES

• Resources are wasted to large-scale involvement
• MBO is for short period goals
• A lot of information is required for setting the clear objectives
• Effectiveness of MBO depends upon quick information.
• May require changes in organization to become fully effective

CONCLUSION

Finally, if MBO is viewed simply as an annual exercise is motivated to accomplish the goals.