Managing By Objectives (MBO)

Management by objectives (MBO) is a systematic and organized approach that allows management to focus on achievable 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.

Who Should Attend

Robenny - School Of Business designed this course for everyone who has a role to play in management. This will include the CEO, Directors, Senior Sales & Marketing executives and those specifically charged with managing by objectives

What You Will Cover

Core Concepts

Managers should "avoid the activity trap", getting so involved in their day to day activities that they forget their main purpose or objective.  

Managerial Focus

MBO managers focus on the result, not the activity. They delegate tasks by "negotiating a contract of goals" with their subordinates without dictating a detailed roadmap for implementation. MBO is about setting yourself objectives and then breaking these down into more specific goals or key results.

Main Principle

The principle behind MBO 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.

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. MBO is also used by chief executives of multinational corporations (MNCs) for their country managers abroad.

Setting Objectives

In MBO systems, objectives are written down for each level of the organization, and individuals are given specific aims and targets.

Balance between Management and Employee Empowerment

The balance between management and employee empowerment has to be struck, not by thinkers, but by practicing managers. Turning their aims into successful actions, forces managers to master five basic operations:

• setting objectives,
• organizing the group,
• motivating and communicating,
• measuring performance, and
• developing people, including yourself.

Managing for Results

The only place where meaningful management results can be won is the outside world. Managing for results is expansion of MBO into the marketplace. It is the theory and practice of how to produce results on the outside, in the market and economy.

Individual Responsibility

MBO creates a link between top management's strategic thinking and the strategy's implementation lower down. Responsibility for objectives is passed from the organization to its individual members. It is especially important for knowledge-based organizations where all members have to be able to control their own work by feeding back from their results to their objectives.

Case Studies

Personal action plans