Organizational Behavior

Point-By-Point

A Study on the Effects of the MBO Style in Organizations

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I . Introduction

Most , if not all organizations are rules by common objectives , a common vision that is upheld in the hierarchy , ideally embodied in all plans and activities that carry the company 's name . One way to ensure the realization of these goals is to translate the vision and mission into terms understandable on every level of the organization , measurable and attainable , and significant to each manager . Created in 1954 by

br management guru Peter Drucker , Management by Objectives or MBO is the crystallization of this technique it is an organized and systematic tool that allows managers to center on achievable goals , thus maximizing results from resources available (Kotelnikov , 2008

The application of MBO is possible in all departments of an organization , and is defined by specifying actual targets . Unique to MBO is the SMART (Specific , Measurable , Achievable , Relevant , and Time-Specific ) method of initiating each set objective , which is also used to validate the completion of each at the end of the period specified (LearnMarketing .net . While MBO may be heralded by many as the most effective and realistic management model , its approach has been criticized for its space in promoting passiveness and being conservative rather than challenge and a proactive stance among subordinates

II . MBO in Action : Intel , Canon , Hewlett-Packard , and Carrefour

Four of the biggest global names in their respective fields have appropriated MBO as a means to improve and promote company...