\u2192 Management By Objectives (MBO) is a management system in which each member of the organisation effectively participates and involves himself.<\/p>\n
\u2192 It creates self-control and motivates the manager into action before somebody tells him to do something.<\/p>\n
\u2192 Prof. Reddin defines MBO as, \u201cthe establishment of effective standards for managerial positions and the periodic conversion of those into measurable time bound objectives linked vertically and horizontally and with future planning\u201d.<\/p>\n
\u2192’ An attempt is made by the management to integrate the goals of an organisation and individuals. This will lead to effective management.<\/p>\n
\u2192 MBO tries to combine the long run goals of organisation with short run goals.<\/p>\n
\u2192 The MBO process is characterised by the balance of objectives of the organisation and individual.<\/p>\n
\u2192 The definition of organisational objectives states why the business is started and exists.<\/p>\n
\u2192 Objectives for each section, department or division are framed on the basis of overall objectives of the organisation.<\/p>\n
\u2192 Key result areas are fixed on the basis of organisational objectives premises.<\/p>\n
\u2192 The objectives of each subordinate or individual are fixed.<\/p>\n
\u2192 Subordinates are induced to set standards themselves by giving an opportunity.<\/p>\n
\u2192 The objectives are framed on the basis of availability of resources.<\/p>\n
\u2192 The available resources should be properly allocated and utilized.<\/p>\n
\u2192 The superior and subordinates should hold meetings periodically in which they discuss the progress in the accomplishment of objectives.<\/p>\n
\u2192 The discussion is related with subordinates\u2019 performance against the specified standards. The superior should take corrective action.<\/p>\n
\u2192 The problems faced by the subordinates should be identified and steps should be taken to tackle such problems.<\/p>\n
\u2192 Management By Exception (MBE) is a style of business management that focuses on identifying and handling cases that deviate from the norm.<\/p>\n
\u2192 General business exceptions are cases that deviate the normal behavior in a business process and need to be cared for in a unique manner, typically by human intervention.<\/p>\n
\u2192 With an insignificant or no deviation, no action is required and senior managers can concentrate on other matters. If actual performances deviates significantly, the issue needs to be passed to the senior managers, as an \u201cexception has occurred\u201d.<\/p>\n
\u2192 The top management executive should review the organisation\u2019s objectives to frame the objectives according to the changing situation.<\/p>\n
\u2192 MBO emphasises only on short-term objectives and does not consider the long term objectives.<\/p>\n