116 Long Range Planning, Vol. 19, No. 6, pp. 116 to 123, 1986
OO
Printed in Great Britain
MBO: The Fad That Changed
Management
Eugene J. Seyna
Management by Objectives was introduced just over 30 years
ago by Peter Drucker. It has been one of the most widely
written business topics but, in spite of this, there has been a
continuing controversy about the meaning of MB0 and
whether it has been of value. The author argues that most of the
problems have been due to the lack of a generally accepted
definition. A new and comprehensive definition, based on
Peter Druckers original work on the subject, is presented. The
author believes that this definition will help organizations use
MB0 to increase productivity, improve quality, lower costs,
make faster decisions and serve customers better.
Management by Objectives (MBO) is just over 30
years old. During this period it has been one of the
most widely discussed management topics-more
than 122 different periodicals have had articles on
the subject! Why write another one?
There are at least two reasons:
(1) As an anniversary review of what has happened
with this concept since its introduction in 1954.
(2) To demonstrate that it is useful to modern
managers.
While we shall briefly look at the history of MBO,
the main focus of this paper will be on MB0 as a
system of managing that is not only useful, but
necessary, in the 1980s and beyond.
Intelligent and intense competition, difficult econo-
mic times and political uncertainties make manag-
ing more difficult now than ever before. To meet
these situations, superior managers with the most
dynamic organizations are needed. I believe that
MB0 must be part of this combination. Jim Hayes,
the recently retired chairman of American Manage-
ment Associations and Management Centre Eur-
ope, was once asked by a MNC vice-president at a
Eugene J. Seyna is Director of International Management Consulting
Services, Eastman Kodak Company, Rochester, New York.
0024-6301/86 S3.00 + .
Pergamon Journals Ltd.
meeting I attended: ‘Jim, is MB0 a good way to
manage?‘Jim replied: ‘Ken, there is no other way.’
This is also a personal paper, reacting to my
frustrations. I have had the opportunity of introduc-
ing and leading the implementation of MB0 in
dozens of countries around the world, and in
knowing personally hundreds of consultants and
MB0 coordinators who have worked with MBO. I
have seen success and know from others that it has
been beneficial in all kinds of organizations in both
the private and public sectors and in all kinds of
cultures. But, then I read statements like these and
get angry:
If I were asked to name the one modem management
technique in common usage which has caused most harm to
the businesses involved, I would unhesitatingly answer
Management by Objectives.’
In the light of what appear to be inherent conceptual
problems, MB0 has generally not succeeded; devoting
more effort to it to make it better is probably a waste of
time.*
Why should I get upset over what people write? It’s
rather simple, at least to me; most businesses are
locked in a struggle for survival, if we are not
successful in producing satisfaction for customers
then we shall lose the standard of living we have
become accustomed to. Achieving the right pro-
duct, at the right quality, at the right price, at the
right time and with the right service is essentially a
matter of management.
Everybody studies the Japanese inside and out,
looking for some hidden Oriental secret-there is
no secret, it’s simply that the Japanese analyze well,
make the necessary plans, and carry them out with
the proper attitude. In other words, they manage
well.
So I see MB0 as the rational practical managing
style that is needed to combat competition. We are
beginning to see stories about the need to ‘get back
 MBO:
to the basics’, to quit trying all the latest fads and
practice the core of the managing process very well.
Professor Edwards Deming, the spirit behind the
Japanese quality movement said: ‘The Japanese have
a constancy of purpose. We keep looking for new
things.’ MB0 gives us a constancy of purpose-it is
basic managing.
A practising manager, reading negative comments
like the two above, would likely say: ‘Keep MB0
away from me, it’s trouble.’ Unfortunately, many
have done this and have passed up a tool that would
have been helpful. Hopefully, this paper will
convince the doubtful that the MB0 concept is
absolutely sound, but that a misunderstanding of
what MB0 is and how it works has often prevented
successful implementation.
A Brief History
In his 1954 book, The Practice ofA4anagement,3 Peter
Drucker introduced a concept of managing called
Management by Objectives and Self-control. In this
he brought together the knowledge and experiences
of over 100 years of management practice into a
unified system.
Peter Drucker gave us the concept of MB0 but
unfortunately never wrote a how-to-do-it book.
Consequently, those who have been interested in
the idea have seen what they wanted to see and used
whatever parts seemed useful to them. This had led
to a rather checkered history of acceptance and
utilization; it has been praised, criticized, offered as
the magic solution to management problems, or
spurned as a waste of time. This evolution is
depicted in Figure 1.
Early in its history, some people began looking
upon MB0 as a panacea for solving management’s
1980
Often Referred to As a
Management System
Recognition That
Good Programs
Bring Benefits
Heavily Techn
Orientation
iqu<
1970
Low Point in Reputation
Figure 1. The evolution of MB0
The Fad That Changed Management 117
problems. Unrealistic expectations were raised and,
when they were not answered, MB0 was blamed.
These disappointments were widely circulated and
contributed to the poor reputation which subse-
quently developed. From the very beginning there
were misunderstandings about the definition and
purpose.
Among the earliest users of MB0 were functional
units which tended to take narrow views and saw it
only for limited application in selected areas.
Personnel people, for example, were among the first
who were attracted to MB0 but thought of it
primarily as a method for achieving completely
non-subjective and accurate performance evalu-
ations. It was never possible to fulfill these require-
ments and so more people were disappointed.
Now the critics began reviewing these narrowly
applied programs and began questioning the entire
concept.
Throughout the 1960s and early 197Os, MB0 was
probably the most important topic in management.
There was a strong feeling that ‘there must be
something to MBO’, so everybody seemed to be
trying it, still usually in limited areas. However,
another problem now surfaced, bureaucratization.
In a reaction to the behavioral attempts by personnel
people, very formal and organized programs were
developed. Sadly, they brought with them rules,
regulations and forms. The pendulum was swinging
from the overemphasis on human aspects to heavy
stress on techniques. The balance point was passed.
Again the critics wrote furiously, but now about
paperwork factories, wasted time and regimen-
tation.
These negative stories built an unfortunate image of
MB0 which has continued and many present-day
1954
MB0 Introduced as a
0 Management Philosophy
Considered by Some
As a Panacea
Applied Narrowly
in Limited Areas
118 Long Range Planning Vol. 19
managers have had their opinions formed by this
history. And, to be fair, the criticisms were not
always untrue; MB0 had become associated with
strait-jacket management and blue-sky industrial
relations policies. It was often heard in the 1970s that
more MB0 programs failed than succeeded.
By about the middle of the decade, however, success
stories were becoming common and more serious
attention was paid to MBO. A number of com-
panies had seen the logic of it and, treating it as a
style of managing, were achieving positive results.
By 1980 MB0 had progressed far enough so that it
was often referred to as a system of managing. It had
taken 25 years for people to come all the way
around to Drucker’s starting point! As George
Odiorne wrote at the time: ‘Management by
Objectives is a contemporary technique with a long
and complex history. Despite its occasional detrac-
tors, MB0 remains alive and well, and its future
looks promising.‘4
Results With MB0
There are hundreds of success stories about MB0 in
a variety of organizations, large and small, and in
both private and public sectors. However, many
detractors have said that case histories are imperfect
measures because they are not scientific. Undoubt-
edly, case histories tend to be biased according to the
views of the writer, but the tremendous number of
them surely proves that something good must have
happened. Following are just a few examples of
positive MB0 results, chosen to demonstrate the
variety of organizations that have made it work:
Paul Revere Lijz Insurance Company5
‘While we can’t attribute the following results
totally to our PRIDE (MBO) effort, we’re con-
vinced that it has made a significant contribution:
* Home-office employees decreased from 1200 to
950
* Six record-sales years in poor economic times
* Turnover down from 50.2 to 16 per cent
* More promotions from within which saved
$100,000
* Corporate effectiveness up 94 from 65 per cent
* Absenteeism down 3.3 days per employee from
11 days
* Measurable increase in morale.’
Air Force Contract Management Division6
‘Observed benefits with MBO:
Q Identification of long-term directions
d Structure to follow through and implement
goals
* Coordinated/integrated command-wide efforts
December 1986
* Improved communications, accountability and
commitment
zl Reduction of reflight rate-full salaries, other
* Cost savings of 848m in 1980
B Improved support to customers.’
Illinois Health Care Associations7
‘Two years ago, the Association found itself in a
spiral of declining membership, lower credibility on
the part of its members and reduced revenues . . .
our board of directors was having difficulty reach-
ing agreement on policies relating to the serious
regulatory and economic problems facing our
members. We took steps to remedy the situation. . .
we instituted MBO. It worked.’
Diebold, Inc.*
‘MB0 is working for the Installation and Technical
Services Group of Diebold. Since the introduction
to our division in 1972, performance on all levels has
measurably improved, local management is now
using the input of the productive work force in
establishing objectives, and field managers report
that the participative approach to management has
assisted them in dealing with their responsibilities.’
Kodak Australasia Pty. Ltd.’
‘A four-year study of an MB0 introduction and
implementation in an entire company. Some of the
results for that period:
* Sales +80%
* Net earnings + 250%
* Employment - 24%
* Major department productivity +37%
* Major department labor turnover -53%
$7 Major department payroll staff -11%
72 One marketing division turned five successive
years of loss into profit
B Regional Vice-President: “They have improved
communications, morale, strategic planning and
productivity. This wouldn’t have happened
without MBO.”
In a 20th anniversary appraisal of MBO, Dale
McConkey wrote: ‘Evidence to date indicates that
the effect of MB0 has been most dramatic, both on
the overall approach of managing and on the many
parts of the management process . . . probably its
single benefit has been its insistence on improving
organizational effectiveness through improving the
effectiveness of the individual manager.“’
At this 30th anniversary, I believe we can say that
MB0 is more widely used than ever before. The
focus, however, has changed; from one based on the
individual manager, to one on the operations of the
total organization. MB0 is now used to improve
 MBO: The Fad That Changed Management 119

the major steps in the process that carry out the management .. it is not a technique but a way of
work. managing . .‘12

*However, an interesting thing has happened; for a Heinz Weihrich: ‘Management by Objectives, which
focuses on results, is one of the most successful approaches to
quarter of a century people wrote and argued about
management . . . a system of management.‘13
MB0 but, now, all of a sudden, in only the last few
years, it has become a subject that creates little
Unfortunately, not everyone has seen MB0 this
interest.
way. There have been dozens of so-called ‘defini-
tions,’ causing no end of trouble to those managers
Does this mean that people have given up on MBO?
who were searching for help in introducing the
On the contrary, the reason is simply that MB0
philosophy.
basic principles are now in common practice and
debate is no longer needed. As a company president
said to me about his MB0 project: ‘When you stop
talking about MB0 that means you’re doing it.’ Some Definitions
Following is just a partial selection of the MB0
Do you know of an organization that, in 1986, has
descriptions you can find in magazines and books:
not at least considered what its mission should be?
Can you think of a company or public agency that * ‘... it is really industrial engineering with a new
does not make plans based on some consideration of name . . .‘14
its environment? Can you name any successful
* ‘. . . for management development . . .‘I5
organization that does not expect its managers and
professionals to develop and achieve objectives? I * ‘... some use it for planning while others focus
suspect you wili agree, all ‘good’ organizations now on its value in controlling-that is, as an appraisal
do these things as a matter of course. Reflect back tool.“6
30 years, before MBO; if I had asked these questions
* ‘... an OD program . . .“’
then would the answers be different? Certainly they
would, most of these subjects were rarely considered * ‘... a diagnostic tool . . .‘I*
at that time.
* ‘. . . focusing only on individual employee’s
performance and training . . .‘19
It is no accident that these activities have become
common practice, they are the direct result of the * ‘...one of the many parts of the organization’s
attention given to MB0 during the last three management systems.‘20
decades; they are the core of MBO. Peter Drucker
* ‘... a staff program . . .‘2’
you have succeeded! Management by Objectives is
very much a way of management life. a ‘... a manipulative process . . .‘21
* ‘... a mechanical system . . .‘21
You might think that our story is over: we have
traced the history of MBO; listened to critics; and * ‘... a bottoms-up system . . .‘22
then refuted their criticisms by reviewing success
* ‘... a social process between two or more
stories. But, there is more to the tale. While the basic
human beings . . .‘=
principles are being put to use, many managers do
not recognize that these principles should form a * ‘... a popular training technique . . .‘24
total system of managing. Consequently, the major
~2 ‘...this evaluation and motivational
benefits have not been received.
system . . .‘25

MB0 has been plagued by a problem since the Q ‘... an administrative tool for evaluating pro-
beginning; there has never been a widely accepted gram results . . .‘26
definition. This has caused considerable misunder- * ‘... a managerial tactic, not a management
standing, confusion and misapplications. MB0 as a system.‘27
total managing system is not often used and the parts
that are adopted are imperfectly employed. Take your choice! Whatever your inclinations, you
can find a definition to please, then introduce
This is really a strange situation since good defini- techniques according to this definition, and say: ‘We
tions have been written and often referred to. The are using MBO.’ This is what has happened; there
major leaders of MB0 have clearly described MB0 are about as many variations of ‘MBO’ as there are
as being comprehensive. writers. H. K. Baker described the situation so very
well :
George Odiome: ‘. . . in 1965 . . . I proposed a new
interpretation-that it was a system of management .. Few management concepts have received more attention
indeed it has evolved into such a system.‘” and caused as much confusion as management by objectives
. . . the adoption of MB0 has varied from resounding
John Humble: ‘I would define MB0 as a system of success to dismal failure. Why? One of the reasons for this
120 Long Range Planning Vol. 19 December 1986

diversity involves some confusion surrounding the meaning objectives; there can be no misunderstanding, he equates
of MB0 . a veritable jungle of terminology, modifica- managing with managing by objectives. He describes the
tions and variations has become associated with the modern planning process which starts with strategic
concept.*’ thinking and ends with human action:

Management is not just a creature of the economy; it is a

creator as well. And only to the extent to which it masters
What Did Drucker Say? the economic circumstances, and alters them by conscious,
The surprising thing is that, in all these years, few directed action, does it really manage. To manage a business
people seem to have turned to Drucker’s book, The means, therefore, to manage by objectives.
Practice ofManagement, to see exactly what he said
A business must be managed by setting objectives for
about MB0 in this introduction of the concept.
it. . . . Of course, objectives are not a railroad timetable.
Consultants, professors, and managers appear to They can be compared to the compass bearing by which a
have developed their own definitions by reading ship navigates. The compass bearing itself is firm, pointing
and talking to each other. A great disservice has been in a straight line toward the desired port. But in actual
done to a powerful management structure. navigation the ship will veer off its course for many miles to
avoid a storm . . . she may even change her destination in
We shall try to remedy this by going to the original mid-ocean.
source, Drucker’s book, and select out the key
points of his conceptual thinking and advice. These What a business enterprise needs is a principle of manage-
ment that will give full scope to individual strengths and
points will be grouped into Key Subject Areas
responsibility, and at the same time give common direction
which will show us what he felt was most
of vision and effort, establish teamwork and harmonize the
important. The Key Subject Areas and descriptive goals of the individual with the commonwealth. The only
quotes will outline ‘Management by Objectives- principle that can do this is management by objectives and
Drucker Style’. self-control . . . it applies to every manager, whatever his
level and function, and to any business enterprise whether
The first thing to note is that Drucker did not large or small.
merely write, Management by objectives, he said
‘Management by Objectives and Selfkontrol. He
Key Subject Area-The Use of Objectives
included the latter term because, he asserted: ‘It
Building on his insistence that objectives are needed
makes it possible for a manager to control his own
to manage an organization, Drucker details the
performance. Self-control means stronger motiva-
extent to which objectives are necessary for setting
tion: a desire to do the best rather than just enough
expected results and for the horizontal communica-
to get by.’
tions needed to accomplish these objectives:
This is a title which combines the technical part of Each manager from the ‘big boss’ down to the production
managing with the human contributions, two foreman or the chief clerk, needs clearly spelled-out
aspects which we must consider in our definition. It objectives . . . They should lay out what contribution he
is surprising that so many have missed this very and his unit are expected to make to help other units obtain
important point and stressed one part or the other their objectives. Finally, they should spell out what
but rarely put both together. The Key Subjects that contribution the manager can expect from other units
Drucker wrote about are as follows: toward attainment of his own objectives. Right from the
start, in other words, emphasis should be on teamwork and
team results. These objectives should always derive from the
Key Subject Area-The Purpose of the Organization
goals of the business enterprise.
All members must contribute to a common purpose
but, in order to do so, they must know this purpose, Drucker cautions that priorities must be set so that
that is the mission of the organization. Many MB0 efforts can be focused on the most important areas:
programs completely leave out this first step and
begin the process in the middle levels with super- Objectives are needed in every area where performance and
visors and subordinates discussing the objectives of results directly and vitally affect the survival and prosperity
the subordinate. MB0 has often been seen as a ofthe business. . . It is essential that management know and
rather simple series of two-person interactions for consciously decide which area to give priority.
the review of work plans. Drucker wrote about the
importance of purpose: He stresses the need to monitor the improvement
and make revisions to the objectives as required:
Ifwe want to know what a business is, we have to start with
its purpose . . . It is, then, the first responsibility of top It is always important to adapt to economic changes rapidly,
management to ask the question ‘What is our business?’ . . . intelligently and rationally . . . we can assume that there
management must also ask: ‘What will our buziness be?‘. . . always will be fluctuations . . all objectives have to be
and ‘Are we in the right business or should we change our reexamined continually.
business?’
Key Subject Area-Participation
Key Subject Area-The Need for Objectives Throughout his book, Drucker stresses the indi-
Drucker is very specific about the importance of vidual; each person must be involved in developing
 MBO:
the objectives for his or her job, with good
communications :
work will become easier, more effective, more productive,
the more we plan before we do . . . there must be at least a
trace of doing in one’s job. Otherwise, one dreams rather
than performs. One cannot, above all, do only; without a
trace of planning in his job, the worker does not have the
control he needs even for the most mechanical and repetitive
routine chore . . . a job must contain planning as well as
doing.
A decision should always be made at the lowest possible
level and as close to the scene of action as possible.
Moreover, a decision should always be made at a level
insuring that all activities and objectives affected are fully
considered . . . this requires each manager to develop and set
the objectives of his unit himself. . . He must know and
understand the ultimate business goals, what is expected of
him and why.
Key Subject Area-Development of People
Most organizations recognize the need to develop
their people; it is one of the axioms of managing.
But many organizations do this by rote without
clear objectives; Drucker sees the development of
people as a requirement for the organization to do
its complex work:
The prosperity if not the survival of any business depends on
the performance of its managers of tomorrow . . . to
discharge tomorrow’s management tasks we therefore will
need advanced education for people already in management
. . . One does not become broader by adding one narrow
specialty to another; one becomes broader by seeing the
business as a whole. . . manager development must embrace
all managers in the enterprise.
Key Subject Area-Motivation
From the early days of MBO, there was a
recognition of the participative, evaluative, and
motivational aspects of the process; often, however,
to the exclusion of most of the planning and
operational aspects that make MB0 a holistic
system.
Drucker though, describes the growth and develop-
ment of ‘free human beings’ who are ‘directed,
focused and united’ into an effort that produces a
‘real whole’ :
Managementby objectives tells a manager what he ought to
do. The proper organization of his job enables him to do it.
But it is the spirit of the organization that determines
whether he will do it. It is the spirit that motivates . . . the
greatest advantage of management by objectives is perhaps
that it makes it possible for a manager to control his own
performance. Self-control means stronger motivation . .
the human being, unlike any other resource, has absolute
control over whether he works at all.
Key Subject Area-Action
It is surprising to read through a great stack of
articles about MB0 and find many that have little
or no reference to implementation of objectives. You
can read about goal-setting interviews; installing
MBO; MB0 plans; or MB0 as an entrepreneurial
The Fad That Changed Management 121
system, and see only an aside reference to results.
Drucker, on the other hand, mentions ‘attaining
company objectives’, ‘results’, ‘contributions to
success’ or similar phrases throughout the book.
More specifically he talks about action:
objectives should always reflect the objectives of the
business, should always be focused ultimately on business
performance and business results. . Finally any solution has
to be made effective in action . . for the solution to become
a decision, action is needed.
Key Subject Area-Rewards
In many organizations there is not always a
relationship between a person’s performance and
the rewards received. Drucker makes this connec-
tion very clear:
Insistence on high goals and high performance requires that
a man’s ability both to set goals and to attain them be
systematically appraised . . the subordinate, too, must
demand that these decisions be rational rather than hunch,
for they more than anything else, spell out what his superior
expects and considers important . . . Appraisal should
always focus on proven performance . . . Rewards should
be directly tied in with the objectives set for the manager’s
job . . If one can ‘get fired’ for poor performance, one must
also be able to ‘get rich’ for extraordinary performance.
Building a New and Comprehensive
MB0 Definition
We have read through some of the philosophy, ideas
and recommendations of Peter Drucker. From these
statements and others in the book, we shall build a
working definition of MB0 as Peter Drucker told
us it is. We shall not try to develop a ‘how-to’
description but only an outline and sequence of the
major operations which must be done well if the
enterprise is to succeed.
How do we start? An obvious point is the statement
‘to manage a business means, therefore, to manage
by objectives’; this shows very clearly that MB0 is a
total managing system. (An aside here; in his 1954
book, Drucker wrote about MB0 for business
organizations. In his 1974 revision, Management:
Tasks, Responsibilities, Practices, he stresses that
every enterprise, private or public, needs to be
managed.)
He says that ‘no organization can set a direction and
prepare plans for moving in this direction’ if it does
not know its mission. This must be the first step for
any organization-for the total company and for
every unit within it. Each group must know its
purpose, its customers and what it is expected to
accomplish. Therefore, the starting point for every
organization:
(1) The Organization De_fnes Its Purpose
There is a limited amount of time and resources
available so priorities must be set. It is extremely
important that areas which are vital to the success of
122 Long Range Planning Vol. 19 December 1986

the organization are chosen and objectives prepared plans and the appropriate people participate in the
for each area: development of these plans:

(5) Information is Communicated Throughout The

(2) Priority Areas are Chosen
Every organization exists in an external environ-
ment that imposes social, economic, political, and
competitive pressures upon it. An internal environ-
ment affects the ability of it to respond to these
pressures.
Plans must be made to cover all the needs of the
organization, beginning with a determination of the
external opportunities and threats and the internal
strengths and weaknesses:
(3) The Total Envirovtment is Analyzed
Based on the environmental conditions and the
organization goals, coordinated plans are developed
throughout the organization at all levels:
(4) Integrated Plans are Produced
During and after the development of plans, com-
munications must flow up, down and horizontally,
so that the best information is incorporated into the
Organization
Participants in the MB0 style of managing must
understand the overall managing process taking
place, they must have the necessary functional skills
and must continually stay at the state-of-the-art in
their individual fields:
1 s and Understanding are Developed
(6) Needed Sk’11
After all the unit plans are developed, the required
work is divided into individual work plans that,
joined together, will achieve the expected results of
the units and, ultimately, of the organization:
(7) Individual Objectives are Prepared
Because of the active support of management,
participation in the production of plans, wide
dissemination of information, delegation of re-
sponsibility and encouragement of teamwork, all
members are motivated to act as entrepreneurs in
achievement of their objectives:

1. The Organization Defines Its Purpose

1
2. Priority Areas Are Chosen

1
3. The Total Environment is Analyzed

1
4. Integrated Plans are Produced

5. Information is Communicated Throughout the Organization

6. Needed Skills and Understanding are Developed

1
7. Individual Objectives are Prepared

1
8. All Participants are Motivated

1
9. Action is Taken to Achieve Results

1
10. Progress of Plans is Continuously Reviewed

1
11. Appropriate Rewards are Made for Performance

Figure 2. The MB0 system

 MBO:
(8) All Participants are Motivated References
Plans are only dreams unless work is done, so (1) D. Hoare, Pricking the MB0 bubble, The Director, pp. 238-243
individual must take action to accomplish their
expected results in the agreed-upon time. Managers (2) C. H. Ford, MBO: an idea whose time has gone?, Business
at all levels assist by providing resources, informa-
tion, encouragement and counseling: (3)
(9) Action is Taken to Achieve Results (4)
Progress is monitored so that objectives can be
changed if conditions change and so that final results (5) G. R. Lea, An MB0 program for all levels: one company’s
can be compared with expectations. The knowledge
gained about these plans and the methods used is
incorporated into future plans: (6)
(10) Progress ofPlans is Continuotlsly Reviewed (7)
The success of the individual in writing his or her
action plans and then achieving promised results is (8)
evaluated. Performance should bear directly on the
reward system: (9)
(11) Appropriate Rewards are Made&r Performance
(10)
These eleven steps above outline MB0 and describe
the major areas in which an organization must do
(11)
well if it is to be successful and, perhaps, even
survive. A simple, one-sentence summary of all this
(12)
might be:
(13)
MB0 is the system and philosophy that integrates all
managing techniques and all human contributions into a
(14)
untjied organization to achieve a common purpose and
individual jiiljlment.
(15)
MB0 in the 1980s (16)
There should be no mystery about MBO, it is the
basic managing process. The steps we developed (17)
above and which are shown in Figure 2 are those
which should be followed by every manager in
(18)
every kind of organization. These basic principles tie
together all parts of the operations into a unified
(1 S) P. C. Nystrom, Save MB0 by disowning it!, Personnel Journal,
team which marches together in the same direction. August, pp. 391-393 (1977).
It helps managers put things in the proper order and
(20)
makes sure that important steps are not forgotten.
(21)
MB0 changes the work of managers-it changes
the stress from daily supervision to an emphasis on
(22)
thinking, planning, organizing and supporting.
Management by Objectives requires very capable
(23)
managers who are skilled in analyzing; who can
guide and assist subordinates in developing plans
(24)
and carrying them out; and who have a vision of the
future and the present decisions needed to get there.
(25)
These are difficult times, when every organization is
under pressure to increase productivity, improve
quality, lower costs, make faster decisions and serve
customers better. MB0 can help in all of these areas.
(26)
It has been tested in practically every kind of
organization and in most cultures throughout the
world. The basic principles have worked in all of (27)
them because it is a flexible, rational system that
adapts to all situations. It deserves serious consider- (28)
ation, or reconsideration, by all managers.
The Fad That Changed Management 123
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