Hi Friends! If anybody knows what is MBO then pl write me in detail, I want to understand how this would work in Performance Appraisal System. Regards,
From India, Hyderabad
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1From India, Hyderabad
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Mbo means management by objectives... Simply it idicates well planning ... Starting a work with well planned manner reduce mistakes.. U can also refer koontz bookk
From India, New Delhi
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From India, New Delhi
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Hi,
MBO stands for Management By Objectives. It is a method of performance appraisal. At the time of hiring a candidate, the company provides some targets, objectives, and goals. Based on these objectives, goals, or targets, the employer assesses the employee's performance for appraisal.
Regards,
Shruti Gupta
From India, New Delhi
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MBO stands for Management By Objectives. It is a method of performance appraisal. At the time of hiring a candidate, the company provides some targets, objectives, and goals. Based on these objectives, goals, or targets, the employer assesses the employee's performance for appraisal.
Regards,
Shruti Gupta
From India, New Delhi
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MBO stands for Management By Objectives. It is one of the modern methods of performance appraisal. The process starts with setting up objectives first, then assessing the various means of achieving those objectives.
From India, Kochi
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From India, Kochi
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One important point - The goals and objectives are applicable across all levels of hierarchy and are set by both the reporting superior and the subordinate to give a clear direction to the entire organization as a whole.
Regards
From India, Mumbai
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Regards
From India, Mumbai
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Dear Rashika Manth,
Formal definition:
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.
Do check with the given links,
Management by objectives: Definition from Answers.com
MANAGEMENT by OBJECTIVES ( MBO) - focus on achievable goals and to attain the best possible results from available resources (Your freeTen3 Business e-Coach)
From India, Bangalore
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Formal definition:
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.
Do check with the given links,
Management by objectives: Definition from Answers.com
MANAGEMENT by OBJECTIVES ( MBO) - focus on achievable goals and to attain the best possible results from available resources (Your freeTen3 Business e-Coach)
From India, Bangalore
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Simply...
1. At the time of joining, employee KRA's are discussed and given to him/her.
2. After the evaluation period, he/she is rated based on the set targets given at the time of joining.
3. The self-evaluation is done by the employee (appraisee).
4. The employee evaluation is conducted by the Reporting Officer/Head of Department (appraiser).
5. Feedback is provided to the employee by assessing the gap between both evaluations.
SF
From India, Mumbai
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1. At the time of joining, employee KRA's are discussed and given to him/her.
2. After the evaluation period, he/she is rated based on the set targets given at the time of joining.
3. The self-evaluation is done by the employee (appraisee).
4. The employee evaluation is conducted by the Reporting Officer/Head of Department (appraiser).
5. Feedback is provided to the employee by assessing the gap between both evaluations.
SF
From India, Mumbai
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Dear Rashika,
As indicated by all, it is Management by Objectives.
1. The Key Result Areas (KRA) or Key Performance Indicators (KPI) are discussed with each employee, and the objectives are set.
2. The metrics (unit of measurement) are also decided.
3. The frequency of review is indicated.
4. The weightage for each objective KRA is also indicated.
For example, for an HR professional, the following may be the Key Result Areas:
1. Maintaining the recruitment cost Vs. Turnover at a specified percentage. The metric here is the percentage of Recruitment cost Vs. Turnover. The frequency may be half-yearly or annual. The weightage may be 25 marks.
2. The salary as a percentage of Turnover is restricted to a specified percentage. 25 marks.
3. The training cost Vs. Turnover. 25 marks.
4. Filling up vacancies within a specified time frame. 25 marks.
All the KRA put together total to 100. Based on the achievements, the rating is done. It is very objective, and there can be no prejudice in the assessment.
Trust matter is clarified.
M.V. KANNAN
From India, Madras
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As indicated by all, it is Management by Objectives.
1. The Key Result Areas (KRA) or Key Performance Indicators (KPI) are discussed with each employee, and the objectives are set.
2. The metrics (unit of measurement) are also decided.
3. The frequency of review is indicated.
4. The weightage for each objective KRA is also indicated.
For example, for an HR professional, the following may be the Key Result Areas:
1. Maintaining the recruitment cost Vs. Turnover at a specified percentage. The metric here is the percentage of Recruitment cost Vs. Turnover. The frequency may be half-yearly or annual. The weightage may be 25 marks.
2. The salary as a percentage of Turnover is restricted to a specified percentage. 25 marks.
3. The training cost Vs. Turnover. 25 marks.
4. Filling up vacancies within a specified time frame. 25 marks.
All the KRA put together total to 100. Based on the achievements, the rating is done. It is very objective, and there can be no prejudice in the assessment.
Trust matter is clarified.
M.V. KANNAN
From India, Madras
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Management By Objectives (MBO) :
MBO requires the management to set specific, measurable goals with each employee and then periodically discuss the latter’s progress towards these goals. This technique emphasises participatively set goals (that are agreed upon by the superior and the employee) that are tangible, verifiable and measurable. MBO focuses attention on what must be accomplished (goals) rather than how it is to be accomplished. It is, thus, a kind of goal setting and appraisal programme involving six steps:
Set the organisation’s goals: Establish an organisationwide plan for next year and set company goals.
Set departmental goals: Department heads at this stage take the broader company goals (Such as improving profits by 20 per cent, increasing market share by 10 per cent etc.) and, with their superiors, jointly set goals for their departments.
Discuss departmental goals: The departmental goals are now put to discussion in a departmental meeting with subordinates. The departmental heads would require the subordinates to set their own preliminary individual goals, focusing mostly on what they can do to achieve the department’s goals.
Define expected results : In the next step, the departmental heads and their subordinates agree on a set of participatorily set short term, and individual performance targets.
Performance reviews: Departmental heads compare each employee’s actual and targeted performance, either periodically or annually. While periodic review is intended to identify and solve specific performance problems, the annual review is conducted to assess and reward one’s overall contribution to the organisation. Because employees are evaluated on their performance results, MBO is often called a result – based performance appraisal system.
Provide Feedback: Both parties now discuss and evaluate the actual progress made in achieving goals, where things have gone off the track, how best to rectfy the mistakes made in the past, and how the employee could meet the targets next time, focusing attention on his strengths
Warm Regards,
Suthanthira Selvan.C
From India, Madras
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MBO requires the management to set specific, measurable goals with each employee and then periodically discuss the latter’s progress towards these goals. This technique emphasises participatively set goals (that are agreed upon by the superior and the employee) that are tangible, verifiable and measurable. MBO focuses attention on what must be accomplished (goals) rather than how it is to be accomplished. It is, thus, a kind of goal setting and appraisal programme involving six steps:
Set the organisation’s goals: Establish an organisationwide plan for next year and set company goals.
Set departmental goals: Department heads at this stage take the broader company goals (Such as improving profits by 20 per cent, increasing market share by 10 per cent etc.) and, with their superiors, jointly set goals for their departments.
Discuss departmental goals: The departmental goals are now put to discussion in a departmental meeting with subordinates. The departmental heads would require the subordinates to set their own preliminary individual goals, focusing mostly on what they can do to achieve the department’s goals.
Define expected results : In the next step, the departmental heads and their subordinates agree on a set of participatorily set short term, and individual performance targets.
Performance reviews: Departmental heads compare each employee’s actual and targeted performance, either periodically or annually. While periodic review is intended to identify and solve specific performance problems, the annual review is conducted to assess and reward one’s overall contribution to the organisation. Because employees are evaluated on their performance results, MBO is often called a result – based performance appraisal system.
Provide Feedback: Both parties now discuss and evaluate the actual progress made in achieving goals, where things have gone off the track, how best to rectfy the mistakes made in the past, and how the employee could meet the targets next time, focusing attention on his strengths
Warm Regards,
Suthanthira Selvan.C
From India, Madras
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Hi Friends, Good Morning! Thanks a lot for sharing so much knowledge on MBO. My concepts are very clear now and let’s see if we can set up something like this in our system.. Regards,
From India, Hyderabad
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From India, Hyderabad
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Dear Friend Rashika,
Here you go.....about MBO (got it from website for MBA & BBA studends)
The concept of MBO is introduced by famous management scientist Peter F Drucker in his book “The practice of management”. As per the concept the organizational goals are broken down to different level objectives and assigned to individuals at different level in order to have the organizational goal/ objective is met ultimately. Even though the concept is well laid and popularized by Peter F Drucker, he himself has stated that MBO is not a new concept but already in place with a few organizations
Definition: MBO can be defined as a set of targets or objectives set by mutual agreement between supervisors and employees or between employer and employees with a course of action, timeline and measuring and monitoring techniques to achieve the objective.
Process of MBO : Management by objectives starts at the top level of management by deciding the organizational goal. Ultimate focus of every organization is to make profit. Management will lay down some policies and programs to meet this goal. In order to achieve this there need to have a lot of sub actions carried out at various level of the organization. Top level will decide their goal and assign the sub actions to the bottom level.
Objective need to be specific: The set goal to be clear and specific. Need to be realistic and detailed.
Mutual agreement: The manager and employee to mutually agree up on the target and course of actions.
Measurable: The objective should be measurable in terms of set strategies. E.g.: In terms if revenues or number of customer visits done with in stipulated time period
Attainable:
Time line: There should be a time line for the objective to be met or completed. This time line should be achievable and realistic
Advantages:
Sharpens decision making
Motivation to employees as they are a part of decision making
Commitment to attain the goals as the employee themselves set the goals.
Managers are more closely looking at end result rather than looking at routine activities
Role clarifying, for employees
Boss- employee relationship increases
More control over the middle level and bottom level management
Managers can see that the individual objectives and organizational objectives are mutually linked
Practical difficulties and draw backs
Too much focused on certain areas – Over emphasize on goal setting
Other business is not concentrated as only objectives are focused
Only short term goals are set
Documentation is difficult
No objective for higher level managers
Goals are difficult to set
How to make MBO effective
Teach the system thoroughly to the employees
Goals need to be set in consultation with employees
A good measuring and monitoring need to be done
S_M_A_R_T (Specific, Measurable, Attainable, Revenue generating, Time bound)
Goals are difficult to set
Criticism
MBO has been criticized for its over emphasize on objectives and difficulty for implementation. Scientists states that, the lack of detailed and thorough knowledge about the system may lead to collapse of organizational goals or setting of wrong goals.
W. E Deming, points that setting up of production goals may force employees and managers to leave the best practices and to go for any ways they can which may lead to unhealthy practices and poor quality of products and services.
Regards,
R.Gopinath
From India, Madras
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Here you go.....about MBO (got it from website for MBA & BBA studends)
Management by objectives- MBO
Definition: MBO can be defined as a set of targets or objectives set by mutual agreement between supervisors and employees or between employer and employees with a course of action, timeline and measuring and monitoring techniques to achieve the objective.
Process of MBO : Management by objectives starts at the top level of management by deciding the organizational goal. Ultimate focus of every organization is to make profit. Management will lay down some policies and programs to meet this goal. In order to achieve this there need to have a lot of sub actions carried out at various level of the organization. Top level will decide their goal and assign the sub actions to the bottom level.
Objective need to be specific: The set goal to be clear and specific. Need to be realistic and detailed.
Mutual agreement: The manager and employee to mutually agree up on the target and course of actions.
Measurable: The objective should be measurable in terms of set strategies. E.g.: In terms if revenues or number of customer visits done with in stipulated time period
Attainable:
Time line: There should be a time line for the objective to be met or completed. This time line should be achievable and realistic
Advantages:
Sharpens decision making
Motivation to employees as they are a part of decision making
Commitment to attain the goals as the employee themselves set the goals.
Managers are more closely looking at end result rather than looking at routine activities
Role clarifying, for employees
Boss- employee relationship increases
More control over the middle level and bottom level management
Managers can see that the individual objectives and organizational objectives are mutually linked
Practical difficulties and draw backs
Too much focused on certain areas – Over emphasize on goal setting
Other business is not concentrated as only objectives are focused
Only short term goals are set
Documentation is difficult
No objective for higher level managers
Goals are difficult to set
How to make MBO effective
Teach the system thoroughly to the employees
Goals need to be set in consultation with employees
A good measuring and monitoring need to be done
S_M_A_R_T (Specific, Measurable, Attainable, Revenue generating, Time bound)
Goals are difficult to set
Criticism
MBO has been criticized for its over emphasize on objectives and difficulty for implementation. Scientists states that, the lack of detailed and thorough knowledge about the system may lead to collapse of organizational goals or setting of wrong goals.
W. E Deming, points that setting up of production goals may force employees and managers to leave the best practices and to go for any ways they can which may lead to unhealthy practices and poor quality of products and services.
Regards,
R.Gopinath
From India, Madras
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Dear friend,
MBO is an improved version of KRA/KRI. Appraisal through MBO is possible only within big industries; for small and medium-sized enterprises, it is KRA/KRI - a simple way of differentiation.
With Regards,
Vijay Maslekar
From India, Raipur
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MBO is an improved version of KRA/KRI. Appraisal through MBO is possible only within big industries; for small and medium-sized enterprises, it is KRA/KRI - a simple way of differentiation.
With Regards,
Vijay Maslekar
From India, Raipur
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Hi there,
MBO includes setting up of the objectives for departments based upon the goals of the company (some companies do it with the help of X-matrix). The X-matrix includes the overall goals of the company, which are then simplified for various departments.
Now, why MBO is included in Performance Appraisal is because departmental goals are set with the participation of employees. At the beginning of the year, employees of the department set objectives under the guidance of their seniors, which are mutually agreed upon. There is a mid-year and end-year review to assess the achievement of these objectives.
MBO is a very effective method because an employee who has to work towards the achievement of objectives should be a part of setting those objectives.
Regards,
From India, Kapurthala
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MBO includes setting up of the objectives for departments based upon the goals of the company (some companies do it with the help of X-matrix). The X-matrix includes the overall goals of the company, which are then simplified for various departments.
Now, why MBO is included in Performance Appraisal is because departmental goals are set with the participation of employees. At the beginning of the year, employees of the department set objectives under the guidance of their seniors, which are mutually agreed upon. There is a mid-year and end-year review to assess the achievement of these objectives.
MBO is a very effective method because an employee who has to work towards the achievement of objectives should be a part of setting those objectives.
Regards,
From India, Kapurthala
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Hi friends, This is a new word that i learnt today. think it mostly deals with retail sector. where the marketing for objectives takes place. Thanks fr d information.
From India, Hyderabad
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From India, Hyderabad
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so nice ppt you made krishna .keep it up.you actually describe the MBO concept in detail.once again thanks to share with all . Regards, Sneha NIkumbh.(HR) 8898133178
From India, Kalyan
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From India, Kalyan
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Management by Objectives is the modern method of human resources management. Compensation is dependent upon the extent to which the employee's performance matches the agreed objectives. This method of management by objectives frequently leads to increased motivation and enhanced performance on the part of employees.
From Australia, Adelaide
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From Australia, Adelaide
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MBO was first proposed by Peter Drucker. MBO is an approach of management that helps to focus on goals that are achievable and getting maximum output available from resources. The key to the success of the MBO is an effective review system.
Regards,
Charu
From India, Delhi
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Regards,
Charu
From India, Delhi
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MBO is a systematic and organized approach that allows management to focus on achievable goals and attain the best possible results from available resources.
MBO involves participative goal setting, whereby all managers of the firm are directly involved in the strategic planning process. Employees are also involved in choosing the course of action and decision-making. It involves measuring employees' actual performance against set standards, and in most cases, employees are involved in setting their own goals and choosing the course of action. This acts as a motivator to enable them to achieve the targets.
The manager needs to implement a range of performance systems designed in a way that can help an organization function well.
MBO functions on set principles and should operate on the SMART method for checking the validity of objectives.
For an MBO to be complete, there must be feedback.
Regards,
Edna
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MBO involves participative goal setting, whereby all managers of the firm are directly involved in the strategic planning process. Employees are also involved in choosing the course of action and decision-making. It involves measuring employees' actual performance against set standards, and in most cases, employees are involved in setting their own goals and choosing the course of action. This acts as a motivator to enable them to achieve the targets.
The manager needs to implement a range of performance systems designed in a way that can help an organization function well.
MBO functions on set principles and should operate on the SMART method for checking the validity of objectives.
For an MBO to be complete, there must be feedback.
Regards,
Edna
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