Management by objectives (MBO) is a process where managers and employees jointly set objectives, evaluate performance, and provide feedback. MBO was first popularized by Peter Drucker in 1954 as a way for managers to avoid getting too involved in daily activities and instead focus on objectives. It involves cascading goals throughout the organization, participative decision making, explicit time periods for objectives, and performance evaluation. MBO aims to increase organizational performance by aligning goals. While it can motivate employees and facilitate control, it also requires time and risks conflicting objectives.

1. Presented By-
Rahul Dey, Joydeep Chakrabroty, Chandrani
Sutradhar
BBA(H) 3rd Sem 2nd Year
Eminent College of Management & Technology
Management
by objectives
rpoint-templates-design.com

2. 01
01
02
03
Introduction
Management by objectives (MBO), also known
as management by results (MBR), was first
popularized by Peter Drucker in his 1954 book The
Practice of Management.
Management by objectives is the process of defining specific
objectives within an organization that management can
convey to organization members, then deciding on how to
achieve each objective in sequence.
An important part of MBO is the measurement and
comparison of an employee's actual performance with the
standards set. Ideally, when employees themselves have
been involved with the goal-setting and choosing the course
of action to be followed by them, they are more likely to
fulfill their responsibilities.

3. Definition-
“Managers should avoid the activity trap",
getting so involved in their day to day activities
that they forget the main purpose or objective.
Instead of just a few top-managers, all managers
should: participate in the strategic planning
process, in order to improve the implement
ability of the plan, and implemental range of
performance systems, designed to help the
organization stay on the right track.
Peter Ducker
A process whereby superior and subordinate managers
of an Organization jointly define its common goals,
define each individuals major areas of responsibility in
terms Of results expected of him and use these
measures as guides for operating the unit and assessing
the contribution of each of its members.
George Odiome

4. What is MBO?
 Management by objectives (MBO) is a systematic and organized approach that
allows management to focus unachievable goals and to attain the best possible
results from available resources. It aims to increase organizational performance
by aligning goals and subordinate objectives throughout the organization. Ideally,
employees get strong input to identify their objectives, time lines for completion,
etc. MBO includes ongoing tracking and feedback in the process to reach
objectives.
 Management by Objectives (MBO) was first outlined by Peter Ducker in 1954 in
his book The Practice of Management. In the 90s, Peter Ducker himself
decreased the significance of this organization management method, when he
said: "Its just another tool. It is not the great cure for management inefficiency...
Management by Objectives works if you know the objectives, 90% of the time you
don't."

5. MBO Principles :-
 Cascading of organizational goals and objectives
Specific objectives for each member.
 Participative decision making.
Explicit time period
Performance evaluation and feedback

6. Where to use MBO?
 The MBO style is appropriate for knowledge-based enterprises when
your staff is competent.
It is appropriate in situations where you wish to build employees
management and self-leadership skills and tap their creativity, tacit
knowledge and initiative.
Management by Objectives (MBO) is also used by chief executives of
multinational corporations (MNCs) for their country managers abroad.

7. MBO
Process
 Collectively fixing objectives.
Collectively making a plan.
Subordinate implements the plan.
Collectively monitoring performance.

8. Advantages of MBO -
Develops result-oriented philosophy
Formulation of dearer goals
Facilitates objective appraisal
Raises employee morale
Acts as motivational force
Facilitates effective control

9. Limitation
Time-consuming
Reward-punishment approach
 Increases paper-work
Creates organizational problems
Develops conflicting objectives
Problem of co-ordination
 Lacks durability
Problems related to goal-setting
 Lack of appreciation

10. Conclusion
Management by objectives has become de facto practice for
management in knowledge-based organizations such as
software development companies. The employees are given
sufficient responsibility and authority to achieve their
individual objectives.“What is not measured cannot be
managed.”

11. Thank you
Insert your subtitle here