“It’s just another tool. It is not the great cure for management inefficiency… MBO works if you know the objectives, 90% of the time you don’t.”
Peter Drucker
Management by Objectives (MBO) is an elaborate, systematic, ongoing program that helps employees to understand their objectives at organizational and personal level.
MBO principles:
- Cascading of organizational goals and objectives
- Specific objectives for each employee
- Shared decision-making process
- A predefined time framework
- Performance evaluation and feedback
Advantages of MBO:
- Motivation -employees’ involvement in the goal setting process increases job satisfaction and commitment
- Better communication – the evaluation sessions and feedback are supposed to do that
- Clarity of goals – SMART
- Specific
- Measurable
- Achievable
- Realistic
- Time-related
From my experience with MBO, I can tell you that it did not work for me. Mostly because nowadays the manager that set the objectives often already works in a different company when time for the employee’s evaluation comes.
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