Management by objective (MBO)

Management by objective (MBO)

Meaning & definition: it was P. F. Ducker who first gave the concept of MBO to the world way back in 1954 when his perfect of management was first published. The MBO concept, as was conceived by Drunker, reflects a management philosophy which values and utilized employee contributions. Application of MBO in the field of the performance appraisal is a recent thinking. According to the P. Redden, "MBO is the establishment of effectiveness areas and effectiveness standards for managerial positions and the periodic conversions of these into measurable time bound objectives linked vertically and horizontally and with future planning".

According to the S.K. Chakravarty, "MBO "may be defined as a result centred, non specialist operational managerial process for the effective utilization of material, physical and human resources of the organization, by integrating the individuals with the organization and organization with the environment".

Features of MBO:

1.       An attempt is made by the management to integrate the goals of an organization and individuals.

2.       MBO tries to combine the long range goals of organization with the short range goals.

3.       Management tries to relate the organizational goals with society goals.

4.       MBO's emphasis is not only on the goals but also on the effective performance.

5.       It pays constant attention to refining, modifying and improving the goals and changing the approaches to achieve the goals on the basis of experience.

6.       It increases the organizational capability of achieving goals at all levels.

7.       A high degree of motivation and satisfaction in available to employees through MBO.

8.       Recognizes the participation of the employees in the goal setting process.

9.       Aims at replacing the exercise of authority with consultations.

10.   Encourages a climate of trust, goodwill and a will to perform.

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