Management Concepts & Organisational Behaviour - MANAGEMENT BY OBJECTIVES

Process of MBO

   Posted On :  17.05.2018 10:10 pm

Having understood the basic characteristics of the objectives, let us examine the process of MBO.

Process of MBO
 
 
Having understood the basic characteristics of the objectives, let us examine the process of MBO. As a process, management by objectives begins at the top of the organisation with the establishment of specific organizational objectives. Subsequently, objectives at various levels down the hierarchy are decided by mutual discussions and consultations by both superiors and subordinates.
 
The process of MBO includes the following steps:
 
1. establishment of goals for the whole organisation,
2. preparation by subordinates, of specific goals within the framework provided by the superior,
3. joint discussion of an agreement upon the goals by the superior and subordinate,
4. joint review of progress at regular intervals in the light of the predetermined goals, and
5. corrective measures, if necessary, as revealed by the review.

 
In the whole process, setting of goals for the subordinate positions is the crucial step. Unlike in the traditional system where goals are decided for the subordinates by the superiors, in the MBO system, goals are set on the basis of consensus reached in the discussions between superiors and subordinates. They are set in a democratic way. Superiors act as facilitators and create a favourable climate where subordinates freely express their opinions, viewpoints and perceptions about what they believe could be achieved. The process ensures meeting of minds between superiors and subordinates. As a result, there is ample possibility for the subordinates to feel that they are working for their own goals and not for somebody else’s. Consequently, they strive to achieve the goals. As they participate in the goal setting exercise actively, they in turn get motivated to achieve them. Once they achieve the goals, that contributes for the satisfaction of their ego needs. Thus, MBO serves as a motivational technique.

 

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