Management by objectives

Presented by: Rajat Kumar Das Sec-A Regd. No-1041333008

Performance appraisal
A performance appraisal, employee appraisal, performance review is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost, and time) typically by the corresponding manager or supervisor

MBO:It is an individual evaluation method for

performance appraisal

Definition : Management by Objectives (MBO) is a

process of defining objectives within an organization so that management and employees agree to the objectives and understand what they are in the organization. - It was developed by Peter F Drucker

The essence of MBO is participative goal setting, choosing course of actions and decision making. An important part of the MBO is the measurement and the comparison of the employees actual performance with the standards set.

Main Principle
Is to make sure that everybody within the organization has a clear understanding of the aims, or objectives, of that organization, as well as awareness of their own roles and responsibilities in achieving those aims. The complete MBO system is to get managers and empowered employees acting to implement and achieve their plans, which automatically achieve those of the organization.

Managerial Focus
MBO managers focus on the result, not the activity.

They allot tasks by "negotiating a contract of goals" with their subordinates without dictating a detailed roadmap for implementation

THE MBO PROCESS

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-leadershipskills and tap their entrepreneurial creativity, tacit knowledge and initiative.

2 Questions You Need to Answer To Get The Whole Process Rolling

Where do I want to go ? (What is the objective?) How will I pace myself to see if I am getting there? (What are my milestones, or key results?)

Advantages
MBO programs continually emphasize what should be done in an organization to achieve organizational goals. MBO process secures employee commitment to attaining organization. Better communication & coordination. Motivation.

Disadvantages

The development of objectives can be time consuming, leaving both managers and employees less time in which to do their actual work. The elaborate written goals, careful communication of goals, and detailed performance evaluation required in an MBO program increase the volume of paperwork in an organization.