MG223 Fundamentals of

Management Fall 2015

Semester Project
Management by Objectives
Case Study: Dar-e-Arqam Schools (Sindh Region)
Submitted by:
Hamza Abdul Jabbar Qureshi Section C 14k-2116
Muhammad Zaid Khan Section C 14k-2130
Muhammad Shahzaib Rahim Section C 14k-2214
Syed Ahsan Haider Section C 14k-2304

Supervised by:
Mr. Muhammad Ahsan

Department of Computer Science

National University of Computer & Emerging Sciences (NU-FAST)

Table of Content
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Acknowledgement

Abstract

Introduction to MBO (Management by

Objectives)

Practical study of the organization

Data collection methods

SWOT analysis

Conclusion

10

Recommendations

11

References

11

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Acknowledgement
In performing our DLD semester project, we had to take the help
and guideline of some respected persons, who deserve our
greatest gratitude. The completion of this project gives us much
pleasure. We would like to show our gratitude to Mr. Muhammad
Ahsan, FoM course Instructor, FAST-NU for giving us a good guideline
for assignment throughout numerous consultations. We would
also like to expand our deepest gratitude to the Director of Dar
e Arqam Schools and Colleges for giving us permission to
access their staff and general documents.
-The Team Members

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Abstract
Since the privatization policy of Gen Zia Ul Haq in early 1980s, private educational institutions
have grown like mushrooms. These institutions included schools network, universities, colleges
etc. Such educational institution is responsible for producing countrys intelligentsia in the past
25 years. This report talks about one of the largest educational networks from a managers point
of view.
Dar e Arqam Schools and Colleges is one of the largest schooling networks in Pakistan with 470
branches and about 100,000 students. The school network has been serving the country for
almost 20 years. It has currently opened it branches in urban Sindh. The study will be focusing to
the schools Sindh chapter. The Sindh chapter is currently offering education to students of
playgroup till class 4.
Unlike business organizations, an educational institutions structure is quite rigid and
conventional. Management in such institution is always difficult and complicated. Several
problems are faced by managers in running the system. This case study will figure out the
problems and will recommend solutions to them through MBOs principles. To cut MBO in
short: A process where ultimate goals are define by the manager and equally by his subordinates.

Introduction to MBO (Management by Objectives)

The concept of Management by Objectives was introduced by Peter Drucker in 1954 in his book,
The Practice of Management. He wrote MBO is all managers of a company should participate
in strategic planning process. [1]
Management by Objectives is defined as:
It is a process of defining objectives which are approved by both managers and
employees to achieve companys goals and improve the companys performance.
All companies exist for some ideas, and to achieve that, top level management sets goals that are
familiar in all over the company. Plans are passed from one managerial level to another and then
to subordinates are told that what they have to do.
Progress of how the goals are achieving are reviewed by top managers and if goals are achieving
constantly then rewards are given to those employees who have the impact on goals.
Management by Objectives success depends on top level management involvement. MBO
increases organizational productivity. MBO program need stability for employees to completing
the goals that is. If top level managers are rapidly changing goals, then employees will have no
time for perceiving objectives. Subsequently, employees are not able to achieve the goals.

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Today MBO program are used in various activities such as:

Production
Marketing
Sales
Services
R&D
Human Resources
Finance
Information Systems

In MBO program, a top level manager determines the mission and goals of an
organization. Though, he is not the only one to take decisions. These goals are based on
suggestions collected from lower level managers and employees. The goals which are set
by the top level managers are based on an analysis of what should be accomplished by an
organization in a time period. The task of these managers can be rationalized by
appointing a project manager who can supervise and control activities of many
departments. If this process is not done then each managers task to accomplishing the
organizations goal should be cleared.
The S.M.A.R.T is associated with the process of setting objectives in the MBO program.
S.M.A.R.T objectives are:
Specific
Measurable
Agreed
Realistic
Time-bound

Below is a brief introduction of how an MBO programs works.

1) Setting of Objectives:
The initial step of MBO is to set the objectives. If objects are not clear no one can
perform efficiently and effectively. Objectives are set in order that they give clear
idea what a person can do.
2) Identifying Key result areas:
Companys objectives indentify the key result areas. Top level management
indicates these areas. These areas include:
Market standing
Productivity
Profitability
Innovation
3) Setting of subordinates Objectives:
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Companys goals are achieved by working of individuals. Therefore all members

of organization should clear what he had to do or what companys top
management wants him to do. Each employee objectives are set by his/her
manager.
4) Revision of Organizational Structure:
When goals are reset in MBO program, then there is possibility of changing job
description on many positions. This is revision of Organizational Structure.
Objectives and responsibilities are defined in job description.
5) Matching Objectives and Resources:
If objectives and resources are not in equity then it is hard to complete
organization goals. Hence managers must balance objectives and resources. All
managers at every level need resources to accomplish goals. Managers should
also see effectiveness of allocating resources.
6) Conducting Periodic Progress Reviews:
In MBO, top management and subordinates holds meeting frequently to review
the progress of goals. Top management should check subordinates what he is
doing and how effective he is doing work. Since every employee knows his goals,
he can evaluate performance on every stage.
7) Performance Appraisal:
Top management do informal performance appraisal of his/her subordinates every
day or after every two days, also formal appraisal should be done after one or two
weeks.
8) Feedback:
Overall performance of subordinates evaluated and the feedback is provided on
performance to the higher level management. This helps in making decisions that
this program needs changes or not. MBO cycle repeats annually.

Having explained the MBO, its process and importance; we shall now move towards our
organizations case study.

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Practical study of the organization

Dar e Arqam Schools and Colleges is one of the largest schooling networks in Pakistan with 470
branches and about 100,000 students. The school network has been serving the country for
almost 20 years. It has currently opened it branches in urban Sindh. The Sindh chapter is
currently offering education to students of playgroup till class 4. As this study focuses on
schools Sindh chapter, we shall first explain the managerial structure of Sindh chapter

Top-level management: 5 Directors

Middle-level Management: Administrator/Branch coordinator

Low-level management: Principal/course coordinator

The top level management oversees all issues and defines independently the goals and
objectives. The middle level management is less involved with the goal defining process while
low level managements work is to only achieve objectives and implement subsequent plans.
This makes the organizations approach much traditional. Many issues are faced because of this
methodology. Usually, the top level management defines such goals which are not achievable in
the time limit. This creates a sense of tension in the mangers and their employees.
Though, the organization does have a policy of appraisal and bonus, the motivational level of
employees is falling. In such conditions, it becomes difficult for the teachers to concentrate on
daily lessons. This can lead to complaints from parents and also cancelation of admission of
pupils.
Another problem, which we noticed during our study, was the inadequacy in management
training in lower level management. Though the principals are senior educationists, they lack
good management skills. This gap is usually tried to be filled by the middle level management,
however more goes in vain. The principals are usually more experienced than middle level
management in term of education. This causes dissimilarities in both and affects in objectives
accomplishment.

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Data collection methods

To have a justified evaluation of an organization, one should collect appropriate and accurate
data/information There are numerous methods to collect data such as interview, online/offline
questionnaire, observation notes, literature analysis. For this project, we tried our best to retrieve
relevant information from the organization.
We applied various approaches to collect data ranging from printed questionnaires to online
forms (though response rate was low on this). The branch principal is the immediate boss, such
that the questions are usually asked relatively. The questions asked in the questionnaires/forms
from lower level management and teachers are as follows:
a. How much you find yourself compatible and recognized with the mission of the
organization?
b. Do management asked for your participation/suggestions in decision-making/objectivesetting process?
c. What issues you have with your principal/manager and how can they be solved?

Interviews were conducted with middle and top level management. These interviews included
recorded talks relating to issues faced by the management and teachers. Prior discussing the
problems, the top-level management also briefed us to their vision, plans, system etc.
Observation notes were also taken down during weekly meetings between lower management
and teachers. These notes comprises of the talks between the two and points where principal was
not able to explain.

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SWOT analysis
Strengths

Strong organizational culture

One of the largest networks in Pakistan with 470 branches and 100,000+ students
Team of committed and motivated teachers
A strong training structure for staff
Focus on extra-curriculum activities
Involving the parents- augmenting customer satisfaction

Weaknesses

Only 2 branches are located outside Punjab and KPK.

Less expertise to convert in CIE system (prevalent in urban areas)

Opportunities

Increase in standard of livings of people-more middle-class people can admit their

children
Prevailing peace process in Baluchistan can proved beneficial
Increase in tuition fee by competitor schools

Threats

Increase in standard of livings of people-neo upper class (former middle class) may shift
to abroad
More private educational institutions entering in competition
Inflation

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Conclusion
They should apply MBO in to their system, if they want a better management!

Recommendations
Training for lower management system
involving campus coordinator, principals and teachers in objectives designing
process.

References
[1] Drucker, Peter F., "The Practice of Management", in 1954. ISBN 0-06-011095-3

https://online.vmou.ac.in/oldweb/studymaterial/4%20BBA%2001.pdf

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