Management by objectives (MBO) is a systematic and organized approach that allows management to focus on achievable goals and to attain the best possible results from available resources. t is achieved using set targets. Ideally, employees get strong input to identify their objectives, time lines for completion, etc. It is MBO that introduced the SMART criteria: Objectives for MBO must be SMART (Specific, Measurable, Achievable, Relevant, and Time-Specific).
 In some sectors (Healthcare, Finance etc. ) many add ER to make SMARTER, where the E=Extendable R=Recorded. MBO includes ongoing tracking and feedback in the process to reach objectives. Reliable management information systems are needed to establish relevant objectives and monitor their “reach ratio” in an objective way. Pay incentives (bonuses) are often linked to results in reaching the objectives TestIt underemphasizes the importance of the environment or context in which the goals are set.
That context includes everything from the availability and quality of resources, to relative buy-in by leadership and stake-holders. As an example of the influence of management buy-in as a contextual influencer, in a 1991 comprehensive review of thirty years of research on the impact of Management by Objectives, Robert Rodgers and John Hunter concluded that companies whose CEOs demonstrated high commitment to MBO showed, on average, a 56% gain in productivity. Companies with CEOs who showed low commitment only saw a 6% gain in productivity.
When this approach is not properly set, agreed and managed by organizations, in self-centered thinking employees, it may trigger an unethical behavior of distorting the system of results and financial figures to falsely achieve targets that were set in a short-term, narrow, bottom-line fashion. A more fundamental and authoritative critique comes from Walter A. Shewhart / W. Edwards Deming, the fathers of Modern Quality Management, for whom MBO is the opposite of their founding Philosophy of Statistical Process Control.
The use of MBO needs to be carefully aligned with the culture of the organization. While MBO is not as fashionable as it was before the ’empowerment’ fad, it still has its place in management today. The key difference is that rather than ‘set’ objectives from a cascade process, objectives are discussed and agreed, based upon a more strategic picture being available to employees. Engagement of employees in the objective setting process is seen as a strategic advantage by many .
A saying around MBO and CSF’s — “What gets measured gets done”is perhaps the most famous aphorism of performance measurement; therefore, to avoid potential problems SMART and SMARTER objectives need to be agreed upon in the true sense rather than set. Team building is essentially a process involving participation, collaboration and nurturing of team spirit amongst the team members. This sense of team spirit is inculcated amongst participants in the team through interactive team exercises and group discussions.
Team building is required in most of the organized group activity, even as the modern work sphere is increasingly getting specialized with division of labor and the global market is powered by communication revolution. A successful team building requires a number of steps, which include the following: The first and foremost requirement for team building is the recruitment or selection of the participants. Since participants ensure the success of a project, a team leader looks for certain specific traits in them.
They must have confidence and the ability to generate trust amongst the fellow members. A participant must possess leadership qualities and must be positively oriented at all times. Next to selection of participants, it is imperative in team building to have well defined team goals and the same must be communicated to the participating members. The participants in a team must be aware of the reason for their participation so as to remain motivated and to develop inter-group trust.
Defining the goal in advance makes the participants feel worthy and competent, while at the same time giving the team a direction to work. Otherwise, the team members become disoriented, directionless and demotivated. Team building must be considered in context of the team goal. It requires multiple and balanced skill sets to achieve the goal. A right combination of theoretical and practical skill sets ensures the successful goal achievement.
Individuals with technical and theoretical expertise as team members go a long way in coming up with a solution that benefit every one. Each member must be allocated a role appropriate to his or her skill or personality. The task assigned to each of them must be flexible enough to take on new assignments or relinquish the previous one, if required. The members must be willing enough to help team -mates and cooperate with them in ensuring success of the project. A team leader has a great role to play in team’s overall performance.
The leader must have leadership skills to command respect from his or her team. Team building is likely to suffer in absence of positive and effective personality of the team leader, who must be able to positively influence the working environment. Apart from what has been discussed above, successful team building requires training the team in group dynamics, communication skills, conflict management and resolution, goal setting, listening skills and other skills to turn the members into effective participants in a team.