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Management By Objectives
An Introduction:• The concept of MBO was given by: Peter Drucker in  1954.• MBO is also known as “Management by results” a...
Characteristics of MBO•   Mutual Goal Setting•   Compatibility•   Systematic•   Continuity•   Key Result Areas
Objectives of MBO• To relate individual performance to organisational  goals.• To increase the competence and growth of th...
The MBO Process             Diagnosis Final                      GoalReview                     Setting    Interim        ...
Diagnosis•   Understanding the organisation•   Obtaining commitment•   Defining jobs•   Training People
Goal Setting•   Organisational goals•   Departmental goals•   Individual goals•   Review by superior•   Joint Agreement
Action Planning•   Activities required•   Sequence of activities•   Roles and relations•   Time and resources
Interim Reviews• Environmental changes• Revise goals and action plans
Final Review•   Discussion•   Analysis•   Motivation•   Rewards•   Control
Approaches of MBO• Top-down Approach• Bottom-up Approach
Advantages of MBO•   Improved Planning•   Team Work•   Effective Self-control•   Objective Appraisal•   Motivation and Mor...
Limitations of MBO•   Goal setting problem•   Time consuming•   Pressure oriented•   Undermining leadership•   Participati...
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Management By Objectives

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Management By Objectives

  1. 1. Management By Objectives
  2. 2. An Introduction:• The concept of MBO was given by: Peter Drucker in 1954.• MBO is also known as “Management by results” and “goal management”.• The goals are set up in consultation with the subordinates.• According to John W. Humble: “MBO is a dynamic system which seeks to integrate the company’s need to clarify and achieve its profit and growth goals with employees need to contribute and develop themselves. It is a demanding and rewarding style of managing a business.
  3. 3. Characteristics of MBO• Mutual Goal Setting• Compatibility• Systematic• Continuity• Key Result Areas
  4. 4. Objectives of MBO• To relate individual performance to organisational goals.• To increase the competence and growth of the subordinates.• To enhance communication between superiors and subordinates.• To serve as a basis for promotion.• To stimulate subordinates motivation.
  5. 5. The MBO Process Diagnosis Final GoalReview Setting Interim Action Reviews Planning
  6. 6. Diagnosis• Understanding the organisation• Obtaining commitment• Defining jobs• Training People
  7. 7. Goal Setting• Organisational goals• Departmental goals• Individual goals• Review by superior• Joint Agreement
  8. 8. Action Planning• Activities required• Sequence of activities• Roles and relations• Time and resources
  9. 9. Interim Reviews• Environmental changes• Revise goals and action plans
  10. 10. Final Review• Discussion• Analysis• Motivation• Rewards• Control
  11. 11. Approaches of MBO• Top-down Approach• Bottom-up Approach
  12. 12. Advantages of MBO• Improved Planning• Team Work• Effective Self-control• Objective Appraisal• Motivation and Morale
  13. 13. Limitations of MBO• Goal setting problem• Time consuming• Pressure oriented• Undermining leadership• Participation Problem• Inflexibility

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