Management by Management by Objectives (MBO)Objectives (MBO)

Dr. Kavitha H.SDr. Kavitha H.S

Post graduate student in MPHPost graduate student in MPH

Management It is the art of getting things done through and

with people in formally organized groups. It is the art of creating the environment in

which people can perform and individuals can cooperate towards attainment of organisational goals.

It is the art of removing blocks to such performance and a way of optimizing efficiency in reaching goals.

Functions Planning Organizing Staffing & Directing Controlling

Various techniques have been developed to Various techniques have been developed to ensure efficiency by reducing delays as ensure efficiency by reducing delays as well as cost.well as cost.

Quantitative methodsQuantitative methods Qualitative methodsQualitative methods

Quantitative methods are:-Quantitative methods are:-1. Time trends forecasting1. Time trends forecasting2. Time motion studies2. Time motion studies3. Work sampling & activity analysis3. Work sampling & activity analysis4. Queuing theory4. Queuing theory5. Decision theory & decision tree5. Decision theory & decision tree6. Simulation study6. Simulation study7. System analysis7. System analysis8. Management by exception8. Management by exception9. Inventory control9. Inventory control

11.Monitoring exception11.Monitoring exception

12. Cost accounting & cost analysis12. Cost accounting & cost analysis

13. Cost benefit analysis13. Cost benefit analysis

14. Cost effectiveness analysis14. Cost effectiveness analysis

15. Performance budgeting15. Performance budgeting

16. Planning programming budgeting 16. Planning programming budgeting systemsystem

17. Zero base budgeting17. Zero base budgeting

18. Input output analysis18. Input output analysis

19. Linear programming19. Linear programming

20. Gantt chart & work scheduling20. Gantt chart & work scheduling

21. Network analysis21. Network analysis

Qualitative methods:-Qualitative methods:-

1. Management by objectives1. Management by objectives

2. Personnel management2. Personnel management

3. Communication 3. Communication

4. Information systems4. Information systems

5. Organizational design5. Organizational design

Management by objectiveManagement by objective

Modern managerial tool by which Modern managerial tool by which managers can improve their performance managers can improve their performance and their overall effectiveness.and their overall effectiveness.

First used by Peter Drucker more than 25 First used by Peter Drucker more than 25 years ago.years ago.

John Humble of UK “John Humble of UK “a system which a system which integrates an organization's need to integrates an organization's need to achieve its objectives with the managers’ achieve its objectives with the managers’ need to contribute and develop himself need to contribute and develop himself ”. ”.

Uses objectives as a focal point.Uses objectives as a focal point.

Based on concepts Based on concepts

(a) Emphasis on results rather than (a) Emphasis on results rather than activities.activities.

(b) Defining objectives (expected results) (b) Defining objectives (expected results) for specific positions.for specific positions.

(c) Participatory or Joint objective setting.(c) Participatory or Joint objective setting.

(d) Identification of Key Result Areas (KRAs)(d) Identification of Key Result Areas (KRAs)

(e) Establishing a Periodic Review System.(e) Establishing a Periodic Review System.

““means-ends” sequence.means-ends” sequence. Results at one level in an organisation are Results at one level in an organisation are

the means to results at the next higher the means to results at the next higher level level

Results for a given span of time are the Results for a given span of time are the means to results for a longer time-spanmeans to results for a longer time-span

Organisation--------------------Organisation--------------------Long term Long term objectives--------objectives--------

Short term objectives-----------------Short term objectives----------------- KRAs---------------- KRAs----------------

Corporate objectives-----------------Corporate objectives-----------------Action Action plans----------plans----------

Department/ Units-----------------Department/ Units----------------- KRAs--------------- KRAs---------------

Objectives----------------------------Objectives----------------------------Action plans-----------Action plans-----------

Individual managers---------------Individual managers--------------- KRAs--------------- KRAs---------------

Objectives----------------------------Objectives---------------------------- Action plans Action plans

Four steps Identifying the Key Result

Areas (KRAs) Setting up Objectives Action Planning Performance Review

Identifying the Key Result Areas (KRAs) :

Broad areas on which the organization must focus its attention.

20 : 80 concept . Helps to identify those 20%

activities/efforts/time which will yield 80% of the results/output, thereby focusing on them and improving effectiveness.

Eg:- National Polio Eradication Eg:- National Polio Eradication program program

Identifying the Key Result Areas (KRAs) :

High risk areas High risk areas Bihar, UP, MP, Assam, Bihar, UP, MP, Assam, West Bengal, Orissa, RajasthanWest Bengal, Orissa, Rajasthan

Steps :-(i) SWOT Analysis : Analysis of Strengths, Weaknesses,

Opportunities and Threats.(ii) Brainstorming exercise to identify all possible KRAs.(iii) Discussion, analysis & classification to arrive at an

agreed list of KRAs.(iv) Establishment of specific objectives in each KRA.(v) Preparation of Action Plans, including assignment

of responsibilities for results to be achieved.

SWOT AnalysisSWOT Analysis

Strength:-Strength:- Many countries including America have eliminated Many countries including America have eliminated

polio through pulse polio immunisation.polio through pulse polio immunisation.

Weakness:- Weakness:- Many serotypes of wild polio virus Many serotypes of wild polio virus Circulating vaccine derived poliovirus outbreaksCirculating vaccine derived poliovirus outbreaks Environmental persistence of wild polio virus.Environmental persistence of wild polio virus. No additional funds for sanitation & safe water No additional funds for sanitation & safe water

supplysupply

Oppurtunities:-Oppurtunities:- Global investment has produced enough immune people at this point of time to make Global investment has produced enough immune people at this point of time to make

elimination of wild poliovirus possible.elimination of wild poliovirus possible.

Threats:-Threats:- Risk of vaccine associated paralytic polio is 1 in 1.5 to 2.2 million doses in America.Risk of vaccine associated paralytic polio is 1 in 1.5 to 2.2 million doses in America. Wide spread rumorsWide spread rumors

;;

Setting up Objectives Set up measurable and quantifiable

objectives within these KRAs. Mission of the organisation Short-term objectives emanate from

organisational objectives. Strategic objectives are related to choice

of product, technology or market. Four elements:- Quantity, Quality, Cost

and Time.

Mission:-Mission:- Eradicating polio through national Eradicating polio through national

immunization days- pulse polio programimmunization days- pulse polio program

Objectives:-Objectives:- Reach & sustain coverage level more Reach & sustain coverage level more

than 85%.than 85%. Identify “at risk” pocketsIdentify “at risk” pockets Conduct “Mop- up” rounds in low Conduct “Mop- up” rounds in low

transmission periodtransmission period Strengthen surveillanceStrengthen surveillance

(c) Action Planning : Convert objectives into reality. Objectives what is to be achieved Action plans how these objectives are to be

achieved. The four broad steps (i) Choice of strategies which are essential for

achieving objectives.(ii) Fixing the responsibility for achieving each

objective.(iii) Resource allocation for achieving the

objectives.(iv) Scheduling specific activities in specific

sequence for maximum utilization of resources.

Action plans:-Action plans:- Reporting of cases of AFP paralysisReporting of cases of AFP paralysis Improve clinical diagnosis to differentiate Improve clinical diagnosis to differentiate

polio from non- polio cases.polio from non- polio cases. 60 days follow-up of suspected polio 60 days follow-up of suspected polio

cases to confirm diagnosiscases to confirm diagnosis Virus isolation to confirm diagnosis.Virus isolation to confirm diagnosis.

Strategies to eradicate polioStrategies to eradicate polio

1. Routine immunization1. Routine immunization

2. National immunization days2. National immunization days

3. Surveillance of AFP3. Surveillance of AFP

4. House-to-house immunization 4. House-to-house immunization campaignscampaigns

Scheduling:-Scheduling:- BudgetBudget Manpower requirementManpower requirement Logistic requirement, their procurement Logistic requirement, their procurement

& their distribution.& their distribution. Transport Transport Planning for training & orientationPlanning for training & orientation Social mobilizationSocial mobilization IEC material IEC material Supervising & monitoring Supervising & monitoring

TRANSPORTTRANSPORT

INTER & INTRA-INTER & INTRA-SECTORAL SECTORAL MEETINGSMEETINGS

AWARENESSAWARENESSCreating IEC Creating IEC materialmaterial

DISTRIBUTIONDISTRIBUTIONProcurementProcurementLogistic Logistic requirementrequirement

Training & Training & orientationorientation

Manpower requirementManpower requirement

BudgetBudget

Jan Jan DecDecNov Nov OctOctSep Sep AugAugJulJulJunJunMayMayAprAprMarMarFebFeb

(d) Performance Review : Focuses on Performance appraisal, improvement, future

corrective action, frequency of reviews & self appraisal. The main purpose of performance review in MBO

process is to provide corrective feedback to the concerned person.

Actual Performance Compare Performance with

objective Identify Deviation Analyse deviation Corrective

action

Implement corrective action Plan Desired Performance

Advantages Greater role clarity, job satisfaction and better

measurement of performance. No wastage of scarce resources. Single-minded dedication to achievement of

objectives. Motivating factor & weeds out non-performers. Increases productivity through role clarity &

increasing job satisfaction. Provides objective appraisal method. Strengthens superior-subordinate relationship. Based on concept of participation

Disadvantages Problem of joint setting of objectives

among unequals in the organisation. MBO may not always percolate to the

lowest level in the organisation. Difficult to implement in situation of

change.

Thank youThank you