MBO AND MBE

By:~ Bhuvan

INTRODUCTIONDefinition of MBOMeaning

Effective participation of individuals

Identifying common goalsDetermination of objectives

Quote on MBOQuote on MBO “MBO is a comprehensive

managerial system that integrates many key managerial activities in a systematic manner and that is consciously directed towards the effective and efficient achievement of organizational and individual objectives”.

~Koontz and Weihrich

Main principles of MBO

Clear understandingEmpowered employees

Features Of MBOFeatures Of MBO

It is not only a technique but also a philosophy

Setting objectivesProvides evaluation and

mechanism

Contd…,

Creates linkage between organizational goals and individual goals

Rewards are governed by the results achieved

Continuous process

MBO Strategy : Three Basic Parts

Assignment of objects Performance reviews Appraisal for employees

Stages Of MBOStages Of MBO

Defining objectivesAnalyzingSetting standardsSetting objectivesAligning targetsEstablishing the system

Advantages Of MBOAdvantages Of MBO

Targeted PlanningParticipation and CollaborationMotivationEfficient CommunicationTraining and DevelopmentPerformance and Appraisal

Limitations Of MBOLimitations Of MBO

Difficulty in teaching MBO philosophy

Failure to provide guidelines to goal-setters

Difficulty in setting goalsEmphasis on short term objectivesDanger of inflexibility

MBEMBE ((Management by Management by exceptionexception))

*Introduction*

DefinitionApproaches to MBEBasicIntermediateAdvanced

SIX PHASES OF MBE

Assignment of valuesProjection of meaningful

measurementsMake observationComparison of actual values with

expected performanceReporting the balance to managementDecision making

Advantages of MBE

Availability of timeOpportunity to utilize talentIncreases confidence and motivation Uses the best knowledgeIt helps to identify problems before

they become big Better organizational cohesiveness

and achievement of objectives

Disadvantages of MBE

MBE is not puzzle solving You must have the truthYou must stay in touch with your people~Management by walking around

~SUMMARY~MBOSystem of managingResults in better managingEffective controlFailure in explaining philosophy

Difficulty in goal setting

MBEIt’s the idea of minimizing responsibility

Obtaining accuracy in resultsInvolves shaping company’s future

Managers should be trained properly

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