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 beingness of objectives together with is used every bit a tool/technique for achieving the objectives. Modern managements are rightly described every bit 'Management yesteryear Objectives' (MBO). This MBO concept was popularized yesteryear Peter Drucker. It suggests that objectives should non last imposed on subordinates but should last decided collectively yesteryear a concerned amongst the management. This gives pop back upwards to them together with the achievement of such objectives becomes slowly together with quick.

Management yesteryear Objectives (MBO) is the most widely accepted philosophy of management today. It is a demanding together with 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 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 every bit 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 fashion of management. Here, ample a reach 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 dissimilar from MBC (Management yesteryear Control) together with is also superior inward many respects. According to the classical theory of management, overstep management is concerned amongst 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 yesteryear giving orders together with instructions but yesteryear securing cooperation together with participation of all persons. For this, they should last associated amongst the management process. This is possible inward the representative of MBO together with therefore MBO is dissimilar 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 yesteryear managers together with their subordinates acting together, specifying responsibilities together with assigning potency 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 terms Of results expected of him together with usage these measures every bit 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 accomplish its profits together with increase goals amongst the manager's demand to contribute together with develop himself. It is a demanding together with rewarding fashion 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 last jointly handle 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 amongst his superior sets his ain short-term goals. However, it is examined both yesteryear the superior together with the subordinate that goals are realistic together with attainable. In brief, the goals are to last decided jointly through the participation of all.
3. Joint conclusion on methodology: MBO focuses exceptional attending on what must last accomplished (goals) rather than how it is to last accomplished (methods). The superior together with the subordinate mutually devise methodology to last followed inward the attainment of objectives. They also mutually gear upwards standards together with constitute norms for evaluating performance.
4. Makes agency to attain maximum result: MBO is a systematic together with rational technique that allows management to attain maximum results from available resources yesteryear focussing on attainable goals. It permits lot of liberty to subordinate to brand creative decisions on his own. This motivates subordinates together with ensures practiced performance from them.
5. Support from superior: When the subordinate makes efforts to accomplish his goals, superior's helping mitt is ever available. The superior acts every bit 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 showtime stage inward the MBO procedure is to define the organizational objectives. These are determined yesteryear the overstep management together with ordinarily inward consultation amongst other managers. Once these goals are established, they should last 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 amongst 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 amongst necessary tools together with materials to accomplish these goals. Allocation of resources should also last done inward consultation amongst the subordinates.
4. Implementation of plan: After objectives are established together with resources are allocated, the subordinates tin implement the plan. If whatsoever guidance or clarification is required, they tin contact their superiors.
5. Review together with appraisal of performance: This footstep 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 around problems. Performance appraisal at these reviews should last 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 yesteryear crisis. Managers are expected to develop specific private together with grouping goals, develop appropriate activity plans, properly allocate resources together with constitute 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 dry reason for evaluating a person's performance since goals are jointly gear upwards yesteryear superior together with subordinates. The private is given adequate liberty to appraise his ain activities. Individuals are trained to exercise dependent land together with self control. Management yesteryear self-control replaces management yesteryear 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 choke a long agency 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 yesteryear results. Developing activity plans, providing resources for finish attainment together with discussing together with removing obstacles demand careful planning. In brief, MBO provides meliorate management together with meliorate results.
6. Acts every bit motivational force: MBO gives an private or group, chance to usage 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 society 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 last measured against the standards set downwards for measuring of performance together with deviations are corrected inward time. Influenza A virus subtype H5N1 clear gear upwards of verifiable goals provides an outstanding guarantee for exercising meliorate control.
8. Facilitates personal leadership: MBO helps private director to develop personal leadership together with skills useful for efficient management of activities of a concern 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 gear upwards carefully later considering pros together with cons which consumes lot of time. The superiors are required to handle frequent meetings inward society to acquaint subordinates amongst the novel system. The formal, periodic progress together with 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 strength 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 every bit grooming manuals, newsletters, teaching booklets, questionnaires, performance information together with written report into the Organisation. Managers demand information feedback, inward society to know what is just going on inward the Organisation. The employees are expected to fill upwards inward a release of forms thus increasing paper-work. In the words of Howell, "MBO effectiveness is inversely related to the release 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 attempt to gear upwards the lowest possible targets together with superior the highest. When objectives cannot last restricted inward number, it leads to obscure priorities together with 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 finish may come upwards inward conflict amongst those of around other e.g., marketing manager's finish for high sales turnover may reveal no back upwards from the production manager's finish for production amongst 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 last encountered spell coordinating objectives of the Organisation amongst those of the private together with the department. Managers may human face upwards problems of measuring objectives when the objectives are non clear together with realistic.
7. Lacks durability: The showtime few go-around of MBO are motivating. Later it tends to choke 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 role successfully provided measurable objectives are jointly gear upwards together with it is agreed upon yesteryear all. Problems arise when: (a) verifiable goals are hard to gear upwards (b) goals are inflexible together with stiff (c) goals tend to pick out precedence over the people who usage 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 damage of long-term goals.
9. Lack of appreciation: Lack of appreciation of MBO is observed at dissimilar levels of the Organisation. This may last due to the failure of the overstep 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 society that MBO succeeds, it should learn back upwards together with co-operation from the management. MBO must last tailored to the executive's fashion of managing. No MBO programme tin succeed unless it is fully accepted yesteryear the managers. The subordinates should also clearly empathise that MBO is the policy of the Organisation together with they withdraw keep to offering cooperation to learn inward successful. It should last a programme of all together with non a programme imposed on them.
2. Acceptance of MBO programme yesteryear managers: In society to brand MBO programme successful, it is fundamentally of import that the managers themselves must mentally pick out it every bit a practiced or promising programme. Such acceptances volition pick out nigh deep involvement of managers. If manages are forced to pick out NIBO programme, their involvement volition rest superfluous at every stage. The employees volition last at the receiving-end. They would by together with large pick out the lines of activity initiated yesteryear the managers.
3. Training of managers: Before the introduction of MBO programme, the managers should last given adequate grooming inward MBO philosophy. They must last inward a seat to integrate the technique amongst the basic philosophy of the company. It is but of import to adapt do sessions where performance objectives are evaluated together with deviations are checked. The managers together with subordinates are taught to gear upwards realistic goals, because they are going to last held responsible for the results.
4. Organizational commitment: MBO should non last used every bit a decorative piece. It should last 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 yesteryear objective must last woven into an entire designing together with fashion of managing. It cannot move every bit a dissever technique standing alone."
5. Allocation of adequate fourth dimension together with resources: Influenza A virus subtype H5N1 well-conceived MBO programme requires 3 to 5 years of performance earlier it provides fruitful results. Managers together with subordinates should last then oriented that they do non expression frontward to MBO for minute solutions. Proper fourth dimension together with resources should last allocated together with persons are properly trained inward the philosophy of MBO.
6. Provision of uninterrupted information feedback: Superiors together with subordinates should withdraw keep regular information available to them every bit to how good subordinate's finish performance is progressing. Over together with above, regular performance appraisal sessions, counseling together with encouragement to subordinates should last given. Superiors who compliment together with encourage subordinates amongst pay rising together with promotions supply plenty motivation for peak performance.