Management Past Times Objectives (Mbo) - Peter Drucker Mbo

The Concept Of Management By Objectives (MBO)

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

Management past times Objectives (MBO) is the most widely accepted philosophy of management today. It is a demanding together with rewarding mode 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 ameliorate when they know what is expected of them together with tin relate their personal goals to organizational objectives. Superior subordinate participation, articulation finish setting together with back upwards together with encouragement from superior to subordinates are the basic features of MBO. It is a result-oriented philosophy together with offers many advantages such equally employee motivation, high morale, effective together with purposeful leadership together with clear objectives earlier all concerned per-sons.

MBO is a participative together with democratic mode of management. Here, ample a range is given to subordinates together with is given higher condition together with positive/participative role. In short, MBO is both a philosophy together with approach to management. MBO concept is unlike from MBC (Management past times Control) together with is also superior inward many respects. According to the classical theory of management, top management is concerned with objectives setting, directing together with coordinating the efforts of middle grade managers together with lower grade staff. However, achievement of organizational objectives is possible non past times giving orders together with instructions but past times securing cooperation together with participation of all persons. For this, they should live associated with the management process. This is possible inward the illustration of MBO together with thus MBO is unlike from MBC together with 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 together with their subordinates acting together, specifying responsibilities together with assigning say-so for achieving the goals together with finally constant monitoring of performance. The genesis of MBO is attributed to Peter Drucker who has explained it inward his mass 'The Practice of Management'.

Definitions Of Management By Objectives MBO :-

1. According to George Odiome, MBO is "a procedure whereby superior together with subordinate managers of an Organisation jointly define its mutual goals, define each individual's major areas of responsibleness inward price Of results expected of him together with utilization these measures equally guides for operating the unit of measurement together with 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 together with hit its profits together with increment goals with the manager's demand to contribute together with develop himself. It is a demanding together with rewarding mode of managing a business."

Features Of Management By Objectives MBO :-

1. Superior-subordinate participation: MBO requires the superior together with the subordinate to recognize that the evolution of objectives is a articulation project/activity. They must live jointly concur together with write out their duties together with areas of responsibleness inward their respective jobs.
2. Joint goal-setting: MBO emphasizes articulation goal-setting that are tangible, verifiable together with measurable. The subordinate inward consultation with his superior sets his ain short-term goals. However, it is examined both past times the superior together with the subordinate that goals are realistic together with attainable. In brief, the goals are to live decided jointly through the participation of all.
3. Joint determination on methodology: MBO focuses exceptional attending on what must live accomplished (goals) rather than how it is to live accomplished (methods). The superior together with the subordinate mutually devise methodology to live followed inward the attainment of objectives. They also mutually set upwards standards together with flora norms for evaluating performance.
4. Makes means to attain maximum result: MBO is a systematic together with 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 together with ensures adept performance from them.
5. Support from superior: When the subordinate makes efforts to hit his goals, superior's helping mitt is ever available. The superior acts equally a coach together with provides his valuable advice together with guidance to the subordinate. This is how MBO facilitates effective communication betwixt superior together with subordinates for achieving the objectives/targets set.

Steps In Management By Objectives Planning :-

1. Goal setting: The commencement stage inward the MBO procedure is to define the organizational objectives. These are determined past times the top management together with unremarkably inward consultation with other managers. Once these goals are established, they should live 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 move with the managers to determine their private goals. In this way, everyone gets involved inward the finish setting.
3. Matching goals together with resources: Management must ensure that the subordinates are provided with necessary tools together with materials to hit these goals. Allocation of resources should also live done inward consultation with the subordinates.
4. Implementation of plan: After objectives are established together with resources are allocated, the subordinates tin implement the plan. If whatever guidance or clarification is required, they tin contact their superiors.
5. Review together with appraisal of performance: This pace involves periodic review of progress betwixt director together with the subordinates. Such reviews would determine if the progress is satisfactory or the subordinate is facing about problems. Performance appraisal at these reviews should live conducted, based on fair together with 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 together with grouping goals, develop appropriate activity plans, properly allocate resources together with flora command standards. It provides opportunities together with motivation to staff to develop together with brand positive contribution inward 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 together with measurable which encourage high grade of performance. They highlight occupation areas together with are express inward number. The coming together is of minds betwixt the superior together with 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 footing for evaluating a person's performance since goals are jointly set upwards past times superior together with subordinates. The private is given adequate liberty to appraise his ain activities. Individuals are trained to exercise dependent area together with self control. Management past times self-control replaces management past times domination inward the MBO process. Appraisal becomes to a greater extent than objective together with impartial.
4. Raises employee morale: Participative decision-making together with two-way communication encourage the subordinate to communicate freely together with honestly. Participation, clearer goals together with improved communication volition transcend a long means inward improving morale of employees.
5. Facilitates effective planning: MBO programmes sharpen the planning procedure inward an Organisation. It compels managers to intend of planning past times results. Developing activity plans, providing resources for finish attainment together with discussing together with removing obstacles demand careful planning. In brief, MBO provides ameliorate management together with ameliorate results.
6. Acts equally motivational force: MBO gives an private or group, chance to utilization imagination together with inventiveness to accomplish the mission. Managers devote fourth dimension for planning results. Both appraiser together with appraise are committed to the same objective. Since MBO aims at providing clear targets together with their club of priority, employees are motivated.
7. Facilitates effective control: Continuous monitoring is an essential characteristic of MBO. This is useful for achieving ameliorate results. Actual performance tin live measured against the standards set downwards for measure of performance together with deviations are corrected inward time. Influenza A virus subtype H5N1 clear set upwards of verifiable goals provides an outstanding guarantee for exercising ameliorate control.
8. Facilitates personal leadership: MBO helps private director to develop personal leadership together with skills useful for efficient management of activities of a trace organisation unit. Such a director enjoys ameliorate 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 upwards carefully later on considering pros together with cons which consumes lot of time. The superiors are required to handle frequent meetings inward club to acquaint subordinates with the novel system. The formal, periodic progress together with lastly review sessions also swallow 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 pressure level on staff. Reward is provided just for superior performance.
3. Increases paper-work: MBO programmes innovate bounding main of paper-work such equally grooming manuals, newsletters, educational activity booklets, questionnaires, performance information together with study into the Organisation. Managers demand information feedback, inward club to know what is just going on inward the Organisation. The employees are expected to fill upwards inward a pose out of forms thus increasing paper-work. In the words of Howell, "MBO effectiveness is inversely related to the pose out 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 upwards the lowest possible targets together with superior the highest. When objectives cannot live restricted inward number, it leads to obscure priorities together with creates a feel of fearfulness with subordinates. Added to this, the programme is used equally a 'whip' to command employee performance.
5. Develops conflicting objectives: Sometimes, an individual's finish may come upwards inward conflict with those of about other e.g., marketing manager's finish for high sales turnover may give away no back upwards from the production manager's finish for production with to the lowest degree cost. Under such circumstances, individuals follow paths that are best inward their ain involvement but which are detrimental to the company.
6. Problem of co-ordination: Considerable difficulties may live encountered spell coordinating objectives of the Organisation with those of the private together with the department. Managers may confront problems of measuring objectives when the objectives are non clear together with realistic.
7. Lacks durability: The commencement few go-around of MBO are motivating. Later it tends to larn onetime hat. The marginal benefits oft decrease with each cycle. Moreover, the programme is deceptively simple. New opportunities are lost because individuals adhere equally good rigidly to established goals.
8. Problems related to goal-setting: MBO tin business office successfully provided measurable objectives are jointly set upwards together with it is agreed upon past times all. Problems arise when: (a) verifiable goals are hard to set upwards (b) goals are inflexible together with stiff (c) goals tend to pick out precedence over the people who utilization it (d) greater emphasis on quantifiable together with easily measurable results instead of of import results together with (e) over-emphasis on short-term goals at the toll of long-term goals.
9. Lack of appreciation: Lack of appreciation of MBO is observed at unlike levels of the Organisation. This may live due to the failure of the top management to communicate the philosophy of MBO to entire staff together with all departments. Similarly, managers may non delegate adequately to their subordinates or managers may non motivate their subordinates properly. This creates novel difficulties inward 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 club that MBO succeeds, it should larn back upwards together with co-operation from the management. MBO must live tailored to the executive's mode 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 together with they receive got to offering cooperation to arrive successful. It should live a programme of all together with non a programme imposed on them.
2. Acceptance of MBO programme past times managers: In club to brand MBO programme successful, it is fundamentally of import that the managers themselves must mentally receive got it equally a adept or promising programme. Such acceptances volition convey nigh deep involvement of managers. If manages are forced to receive got NIBO programme, their involvement volition rest superfluous at every stage. The employees volition live at the receiving-end. They would generally receive got the lines of activity initiated past times the managers.
3. Training of managers: Before the introduction of MBO programme, the managers should live given adequate grooming inward MBO philosophy. They must live inward a seat to integrate the technique with the basic philosophy of the company. It is but of import to suit exercise sessions where performance objectives are evaluated together with deviations are checked. The managers together with subordinates are taught to set upwards realistic goals, because they are going to live held responsible for the results.
4. Organizational commitment: MBO should non live used equally a decorative piece. It should live based on active support, involvement together with commitment of managers. MBO presents a challenging task to managers. They must shift their capabilities from planning for move to planning for accomplishment of specific goals. Koontz rightly observes, "An effective programme of managing past times objective must live woven into an entire blueprint together with mode of managing. It cannot move equally a split upwards technique standing alone."
5. Allocation of adequate fourth dimension together with resources: Influenza A virus subtype H5N1 well-conceived MBO programme requires 3 to v years of functioning earlier it provides fruitful results. Managers together with subordinates should live then oriented that they do non facial expression frontward to MBO for 2d solutions. Proper fourth dimension together with resources should live allocated together with persons are properly trained inward the philosophy of MBO.
6. Provision of uninterrupted information feedback: Superiors together with subordinates should receive got regular information available to them equally to how good subordinate's finish performance is progressing. Over together with above, regular performance appraisal sessions, counseling together with encouragement to subordinates should live given. Superiors who compliment together with encourage subordinates with pay ascent together with promotions furnish plenty motivation for peak performance.