Management by Objectives

An effective management goes a long way in extracting the best out of employees and make them work as a single unit towards a common goal. Management by Objectives (MBO) is the process of setting objectives in the organization to give a sense of direction to the employees. It refers to the process of setting goals for the employees so that they know what they are supposed to do at the workplace. In this course we study in detail about Management By Objectives.

The following are some of the key features of ‘Management by Objectives’ (MBO) based on its definition:

MBO is a Philosophy:

MBO is a philosophy of management.

Hence, it is crucial that you should understand that MBO is much more than a set of techniques.

Also, MBO focuses on and stress upon what has to be achieved and not upon how to achieve it.

So, MBO helps in guiding an organization to get the best out of their available resources in order to achieve the set objectives. MBO is thus a ‘Philosophy’ of management because it is based upon a concept of human action, behaviour, and motivation.

Moreover, Also, MBO can be applied to both managers and subordinates. MBO can also be applied in any type and size of organization. It can be applied at all levels of an organization and in all functional areas of the organization.

MBO is a Universal Management Tool:

MBO is a universal tool.

Hence, it has some relationship with every management technique prevalent in the organization or elsewhere.

In fact, MBO provides the trigger that drive to improve the relevancy and usefulness of existing techniques in the organization.

Hence, MBO is a unified application of a number of principles and techniques. In this way, MBO also works as a mixing or integrating device. So, MBO is a simple, non-technical and an operational management approach.

Moreover, Also, MBO can be applied to both managers and subordinates. MBO can also be applied in any type and size of organization. Hence, MBO serves as a valuable management tool for profit as well as non-profit organizations.

It can be applied at all levels of an organization and in all functional areas of the organization.

You should always bear in mind that the MBO program may vary greatly from one organization to another.

This is because an organization may design an MBO program for implementation in a sub-unit of the organization or for implementation in the organization as a whole.

Moreover, the kind of methods and approaches that the Managers may adopt may be different from one MBO program to another. MBO programs may also differ from each other in their focus or emphasis.

So, it is crucial that design of any MBO program should be done after in-depth analysis, clearness and balance of objectives and active participation of managers with a view towards accountability for results.