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MBO program - Essay Example

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Explain how an MBO program works and describe the six steps involved in this type of program. MBO (Management by Objectives) is a process whereby a consensus between managers and employees on business objectives is brought about. The term Management by Objectives was first coined by management Guru Peter Drucker in his book The Practice of Management published in 1954…
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MBO program

Download file to see previous pages... Employees are also made to understand how their individual contributions influence overall success of business objectives. Drucker and other management experts have identified six steps in the MBO process. The first step is Motivation, whereby employee's inputs are considered and respected in setting goals for each individual. The keywords during this step are 'empowerment', 'job satisfaction' and 'commitment'. By involving themselves directly in the goal setting process, it is believed that employees will show more commitment to the success of the organization. The next step of the process is about ensuring that proper communication and coordination exists between managers and employees so that performance reviews are conducted in an open and transparent manner. By making the goals clear both management and workers can be expected to be on the same page. The six steps involved in MBO can be summarized as follows: Setting the overall business goals; Setting goals pertaining to departments within; Deliberating within departments in order to achieve a consensus; Agreeing upon commonly understood and discussed goals; Setting goals for individual employees; and finally Monitoring performance against set goals. ...Download file to see next pagesRead More
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