MANAGEMENT BY OBJECTIVES
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MANAGEMENT BY OBJECTIVES
Chapter one
INTRODUCTION:
Background of the study
Management requires a variety of instruments to efficiently administrate the day-to-day operations of the firm. Management by objectives is one of these tools. It is a method of achieving better results in managerial action.
Management by objectives is a managerial method in which the superior and subordinate managers in an organisation identify major areas of responsibility in which they will work, set some standards for good or bad performance, and measure the results against those standards. Derek (2005:156).
Management by objective is also known as Managing By Objectives. However, certain individuals have long emphasised management by objectives, hence accelerating its growth as a system. Management by objectives is a systematic management strategy that establishes goals for any organisational unit.
In his book Management by Objectives, George S. Odiorne (1981:1) defines this concept as “a system of management in which the superior and subordinate jointly identify objectives, define individual major areas of responsibility in terms of expected results, and use these objectives and expected results as guides for operating the unit and assessing the contribution of each of its members.”
Furthermore, Odiorne emphasises that management by objectives is a “system of management,” or an overall framework used to lead the organisational unit and establish its path.
He went on to say that “the superior and subordinate jointly identify objectives”. In other words, it is a participative management approach that necessitates dedication and cooperation.
The definition is concerned with determining the intended “results”. Thus, management by objectives focuses on the organization’s production while evaluating people based on their contribution to that outcome.
Management by objectives is an approach in which management establishes specified goals for employees to meet within a set time frame. Management by objectives is a dynamic method that aims to connect the company’s need to clarify and accomplish profit and growth goals with the managers’ need to contribute and improve themselves. It is a difficult and rewarding style of corporate management.
Management by objectives can be implemented in any size organisation as long as the procedures are understood and managers are patient in allowing the system to settle in initially. Management by objectives is an efficient planning, control, and development strategy.
Koontz and O’Donnell (1968:485) defined management by objective as a technique, system, or method of management in which an organization’s superior and subordinate managers agree on broad goals
translate these goals into a chain of specific short-term goals, define each individual’s major areas of responsibility in terms of expected results, and continuously review accomplishment as the sole basis for assessing and rewarding them.
Management by objectives allows employees to engage in decision-making within specific constraints. It is assumed that the employee has been appropriately picked and trained, and that the employee is aware that they will be responsible for attaining the required results in the organisation.
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