Question 2 OR (a)
MBO versus traditional goal setting; implementing MBO effectively
9 marks
- Time to write
- About 18 minutes
- Notes
- Crux notes
Question
Question 2 OR (a) · 9 marksIn what way, the Management by Objectives approach is different from Traditional goal setting? Suggest the steps an organization should take for implementing the MBO approach effectively.
Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.
Before you write
Read off the question and its marks
Read from the question
- What…?Suggest…Two asks in one question: answer both.
Write it in this order
- Read; underline the asks; jot your points 1 min
- 1 Traditional goal setting and MBO explained 2 marks 4 min
- 2 Differences 3 marks 5 min
- 3 Steps for effective implementation 3½ marks 6 min
- 4 Conclusion ½ mark 1 min
- Check: every ask answered, key terms underlined 1 min
Short on time? Trim steps 1–3 evenly rather than skip one: each is capped at its own marks. End with step 4 in a line or two.
Try it first. About 18 minutes for 9 marks. Write it out, then open the solution.
Solution
Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.
In traditional goal setting, objectives are set by top management and passed downward through the hierarchy. Each level breaks the goals into sub-goals for the level below. Subordinates receive targets without taking part in setting them. Goals are often broad, such as a call to improve performance or increase sales, and are reinterpreted, and sometimes distorted, as they pass down. Appraisal tends to be based on superiors' judgement of traits and effort.
1Manager and assistant sit across the calendar and set the quarter's targets together.
Participation of subordinatesParticipation of subordinates in setting their objectives.
2Mid-term, the two of them stand at the chart: where are we against the plan?
Periodic reviewPeriodic review and feedback on progress.
3Results in, the trophy and the increment letter change hands before the whole office.
Appraisal and rewardsAppraisal and rewards based on results.
Management by objectives (MBO) is a system in which superiors and subordinates jointly set specific, measurable objectives for each unit and individual, consistent with organisational goals; work towards them with considerable self-control; review progress periodically; and appraise performance by results achieved.
How MBO differs from traditional goal setting
| Basis | Traditional goal setting | MBO |
|---|---|---|
| Direction | Top-down only | Top-down and bottom-up (joint) |
| Participation | Subordinates receive goals | Subordinates help set their goals |
| Nature of goals | Often vague, general | Specific, measurable, time-bound |
| Link between levels | Goals may be distorted as they pass down | Cascading, linked hierarchy of objectives |
| Commitment | Compliance | Commitment through participation |
| Control | External control by superiors | Self-control plus periodic review |
| Feedback | Infrequent | Regular progress reviews |
| Appraisal | Based on traits and judgement | Based on results against objectives |
| Rewards | Loosely linked to performance | Linked to achievement of objectives |
Steps for effective implementation of MBO
- Top-management commitment. Senior managers must support MBO, practise it themselves and allow time for it.
- Clear organisational goals. The mission and overall objectives must be defined first, so that unit and individual objectives can be derived from them.
- Training and communication. Managers and employees must understand the philosophy and techniques of MBO, especially how to write measurable objectives and conduct reviews.
- Joint setting of objectives. Superior and subordinate agree on a limited number of specific, challenging but attainable objectives, with measures and deadlines, for each key result area.
- Matching authority and resources. Subordinates must have the authority, budget and information to achieve their objectives.
- Action plans and freedom. Subordinates plan how to reach their objectives and are given freedom to act.
- Periodic reviews. Regular meetings check progress, remove obstacles and revise objectives when conditions change.
- Performance appraisal and rewards. Results are evaluated against objectives and linked to rewards, recognition and development.
- Balance of quantitative and qualitative objectives, so that easily measured targets do not crowd out quality, teamwork or long-term goals.
- Avoiding paperwork overload and keeping the system flexible.
- Continuous improvement: lessons from each cycle feed into the next.
Example. A hospital introducing MBO first sets organisation-wide goals (shorter waiting times, lower infection rates), trains department heads, agrees specific targets with each, reviews them monthly and links annual increments to results.
MBO replaces imposed, vague targets with jointly agreed, measurable objectives and self-control. It succeeds when it is supported from the top, understood by all and used as a management philosophy rather than a form-filling exercise.
Where the 9 marks sit
| # | Component | Marks |
|---|---|---|
| 1 | Traditional goal setting and MBO explained | 2 |
| 2 | Differences | 3 |
| 3 | Steps for effective implementation | 3.5 |
| 4 | Conclusion | 0.5 |
| Total | 9 |
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