The Advantages and Disadvantages of Management by Objectives

Management by objectives (MBO) has many advantages, but it’s not a magic bullet. Implementing management by objectives requires top management support, clearly defined objectives, and trained managers. The MBO process can be implemented in five steps. The first step is to create a broad overview of the company’s objectives. These should be aligned with the firm’s vision and mission. Then, determine how each employee’s role fits into the overall objective.

A good management by objectives system consists of sharing personal objectives with employees. By communicating these objectives throughout the organization, employees can see what is expected of them, and will be more engaged in the company’s overall performance. The results are more engaged employees who feel more engaged and committed to their jobs. MBO works best when the objectives are shared and understood by all employees. This approach encourages employees to reach their goals and work harder to achieve them.

Another challenge of this approach is that managers often forget the context in which they set goals. Attempting to achieve too many goals in one area can lead to the emergence of self-centered employees who may distort the results and present them as accomplishments of unattainable targets. This approach is counterproductive and may even make matters worse. However, it can be a powerful tool for creating a culture of transparency and accountability within a company.

To improve the effectiveness of management by objectives, organizations should set goals for every individual employee. Employees should understand the importance of each objective and how it affects the company’s overall performance. Once goals are established, they can be adapted or adjusted quarterly. As long as they are measurable and attainable, the goals will be a motivational force for employees. This approach has been proven to work well in many organizations and has earned the respect of many top management executives.

While MBO can revolutionize an organization, it’s also important to remember that it’s not always the best option for every company. It can be time-consuming, and it tends to ignore human aspects of the work environment. It’s not suitable for all types of businesses, and it can cause a heightened sense of anxiety among employees. It’s also difficult to sustain MBO over the long-term. There are many other downsides of MBO.

The fundamental problem with this approach is that it militates teamwork and the development of self-control. The social nature of organizations makes it difficult to make objective evaluations. Moreover, if a person does a great job, but is not promoted because of their interpersonal relationships, the result is a dismal performance. The goal-setting process tends to be very emotional and difficult for managers to undertake. And while setting objectives may result in improved morale, it’s also difficult to measure progress over a long period of time.