Management by Objectives
Motivating employees seems to be a challenge for managers - Discuss the advantages and disadvantages of the MBO program and provide at least one example to support your discussion.
Goal-Setting Theories have evolved since the 50s and have an impressive documented literature. The Goal-Setting Theory addresses the issues that goal specificity, challenge, and feedback have on performance (Robbins, 2009, p185). Setting goals and motivating employees are always an important issue for a manager, however in certain cases it is difficult to make it operational. A more systematic way to utilize goal setting is with the management by objectives program (MBO), which introduced the system of SMART method of goals that
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As an example I could refer to the Texas state government, who initiated the management by objectives program in 1978 and ten years later analyzed the results (Lee, 1989, An Analysis of the Implementation and Effectiveness of Management by Objectives (MBO) in Texas State Government). As it was already mentioned beforehand this method has also its advantages and disadvantages, but let’s see which they were in this specific case.
On the whole the analysis highlighted that there was a common agreement that the main elements of the MBO program are practiced at managerial levels. Managers pointed out that their units and divisions became goal and result oriented, the work objectives were clearly defined and were put in writing. There were sufficient checkpoints established and opportunities to meet with the superiors to review
Clearly defined goals as they relate to the organization can motivate employees through goal setting. Goals challenge to employees to make them want to explore new technology, ideas, and gain insight from a diverse workplace. Additionally, giving employees more responsibility will make them believe they have contributed with a sense of higher importance. Without motivation in the workplace, a business will suffer from the lack of efficiency from employees. Perhaps the most significant of increased employee motivation is that of increased productivity (staff@incentives.com, 2010). Therefore, it is important that employers give their employees an opportunity to work hard for their reward to obtain a high level of performance, which is an essential to the success of any business.
Edwin Locke and Gary Latham will be the first ones to openly admit there are active limitations with the goal setting theory. It is not uncommon for individual goals to conflict with organizational goals. Moreover, research has proven complex goals have sparked motivation in teams to implement strategies with substantially high amounts of risk (Knight, Durham, & Locke, 2001). Sometimes people will believe higher risk strategies produce the greatest returns, yet high-risk goals consistently result in failure as well (Knight et. al, 2001). Additionally, when individuals simultaneously create two goals there is a greater chance they exert too much energy and focus on achieving just one of those goals. This can lead to one of the goals not receiving enough attention, which can potentially result in the person failing to reach the end result in either goal. In short, these are three common limitations of goal setting that typically draw concerns from other researchers and theorists. However, it is important people are aware of the limitations that do not receive as much attention, such as team goal setting, unethical behavior in high performance goals, and subconscious goals.
To motivate employees, goals must take into consideration the degree to which each of the following exists: clarity, challenge, commitment, feedback and task complexity. If all five of these elements are present, goal theory says that we will be motivated to produce to a maximum. The specificity of the goal acts as an internal stimulus, the more difficult the goal, the higher the level of performance. Difficult goals energise us because we have to work harder and persist to attain them.
A successful person chooses goals to achieve something that is of great value and importance to them. This in turn motivates the person to achieve the goal because when the desired outcome is very important to a person, that person will be determined to persevere. Goal setting also improves a person 's organizational and time management skills because goal setting requires prioritization and that leads to the successful and sequential completion of necessary tasks. Once a person defines and prioritizes goals a plan should be drawn out detailing how this goal will be achieved. Goals and the time-line for their completion should be clearly defined, it is also important that a person 's
The goal setting theory will be applied to JBO Architects LLP, by ensuring that goals are specific, measurable, attainable, realistic and time bound. I believe that employee’s motivation will
Since the early 1950’s, management by objectives has been a management principle or theory that has been practice within both private and public sector corporations. It was first publicized by the management expert Peter Drucker in 1954. Starbuck (2012) identified management by objectives as Drucker’s primary sources and contribution to his book “The Practice of Management” following the developments of his ideas in his earlier books such as “The Future of Industrial Man” and “Concept of the Corporation” which were published in 1942 and 1946 respectively. Subsequently, management by objectives has gained an increasing publicity and largely influenced many industrial organisations like Fords and General Motors amongst many others as shown in Peter Starbuck’s case studies (Starbuck, 2012:99) and is currently a taught topic within the academic curriculum for areas such as management and administration.
Execution Management and Development frameworks should be incorporated with all other hierarchical procedures and frameworks to be powerful. SMS Handbook Chapter 4 Performance Management and Development 1/12/2003 6
A good management system is essential to run an organization effectively. One main strategy to run a good management system is through the use of a famous management module, management by objectives (MBO) that proposed by Peter Drucker (Drucker, 1954). This module has remained popular and compelling method for achieving goals. As Daft (2012) explained, "management by objectives is a system whereby managers and the employees define goals for every department, project, and use them to monitor the organization's subsequent performance" (p. 194). The management by objectives is a management ideology which is used by Peter Drucker who states that the management based on setting up objectives and self-control are understood as a philosophy of management (Kralev, 2011). Management by objectives is
MBO a management process consisting of five steps. The initial step in the process is for the objectives of the organization to be determined by all of management. This allows all managers to be involved in planning. In the next step the managers will sit down and talk with their team members. The manager and employee will both have a set of goals they feel will help the employee be more effective at his or her job. Both sides discuss what “specific goals, measures of achievement, and time frames” (Thomsom 2) that the employee will complete the goals. The goals should be “specific, measurable, achievable, realistic and time bound.” (Drucker) The next step is for management to monitor the progress of the employee and then evaluate his or her performance. In the last step, it decided whether or not the employees should be granted a raise or promotion depending on what goals they were able to accomplish.
Although there is an understandable degree of variation among the scholars and practitioners about the composition of an MBO program, they all appear to agree on the following guidelines:
Why should organizations engage in HR Planning? Why do some organizations require relatively complex and comprehensive HR planning systems than do others? Discuss.
Management by Objectives (MBO) as a concept first appeared in a 1954 book The Practice of Management. The author, Peter Drucker, has since become known as one of the world’s most influential business experts. Aside from developing the ideas around MBO, Drucker has revolutionised the corporate world with his views and theories on essential things such as leadership. His other famous books include The Effective Executive and Management Challenges for 21st Century.
When we think of the principles of motivation often it is inspirational lines coupled with a majestic photograph hung over an otherwise dreary wall, and it’s true that motivation can come from a lot of places, but as managers in the HIS industry they are responsible for creating it and play a vital role in ensuring team morale. One of the interesting ways management embraces the idea that motivation will boost performance by as much as 25% is through working SMART – that is with goals that are specific, measurable, achievable, realistic and timely. This means that goals should be broken down into workable pieces with appropriate deadlines in order to reduce stress and clarifies what is expected of an individual. SMART goals also provide
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.