UNIT II

Managers and Environment

SETTING OBJECTIVES

Overview Guidelines for objective setting Areas of objective setting Examples Benefits

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Overview
Basic and important tool

Who will set the objective?

Top management Trustees Board of directors Executive committee

08AC601-Principles of Management

Overview
Factors to be considered

Internal environment External environment Organization strength and weakness

08AC601-Principles of Management

Guidelines for setting objectives

Difficult task Requires intelligent coaching by the superior Do not have too many objective

08AC601-Principles of Management

Guidelines for setting objectives

Objective must cover

Main features of the job Must be clear Consider various factors that affect the objective Timely feed back, necessary corrective action Must be reasonable Periodically reviewed Must indicate the resource and authority
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Areas of objective setting

Can have objectives in many areas

But it must meet the following criteria

Must be consistent with the values of management Must point out the organization strength and weakness Satisfy external forces

08AC601-Principles of Management

Areas of objective setting

Examples of objectives

Educational institutions

To select Highly qualified students To obtain 100% placement To obtain 100% results To conduct Value added programs for students To encourage students innovation To encourage innovative teaching methodologies To teach contents more than syllabus..

08AC601-Principles of Management

Benefits
Gives specific target for employee

Gives direction to the employee

Helps in building relationships Improves overall communication Focus on specific task..

08AC601-Principles of Management

SMART objective
S M A R T

Specific

Achievable

Time bound

Relevant Measurable All objectives must be able to meet these key criteria

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MANAGING BY OBJECTIVES

Harold Koontz, Heinz Weirich

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MANAGING BY OBJECTIVES(MBO)
Definition Features of MBO Essential Steps for MBO Benefits and Weakness of MBO

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MANAGING BY OBJECTIVES(MBO)
Management by Objectives (MBO) was first

outlined by Peter Drucker in 1954 in his book 'The Practice of Management'.

Systematic and organized approach that allows

management to focus on achievable goals and to attain the best possible results from available resources

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Features of MBO
Goal oriented

Integrates the goal of an organization and

individual Motivation of employees Emphasis not only on achieving goal but also on performance Increases organizational capability

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Essential Steps for MBO

Set Goals The most difficult step. Develop Action Plan For both workgroups and individuals. Review Progress/ Take corrective action Periodic during the year. Appraise Overall Performance. Review Annual Goals.

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Essential Steps for MBO

Set Goals The most difficult step. Concrete Specific target and timeframe Assign responsibility Develop Action Plan Course of action For both workgroups and individuals

Review Progress Periodicity? Course corrections

Appraise Overall Performance. How are we doing? Do we need to restate our goals?
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Benefits and weakness of MBO

Benefits

Improvement in managing through result oriented planning Classification of organizational roles

Encourages team work Development of control
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Benefits and weakness of MBO

Weakness

Failure to teach philosophy of MBO Failure to teach guidelines to goal setters Difficulty of setting verifiable goals More emphasis on short term goals Time consuming Increased paper work

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