Does Management by Objectives Work?

Management by Objectives (MBO) turned sixty years old recently. Hundreds of thousand of managers and professionals have engaged in MBO by going through the process of setting personal objectives that were linked to the organization’s major areas of emphasis. Does all this work make any difference? The answer is a resounding, “Yes!” Researchers in the Journal of Applied Psychology studied companies before and after implementing MBO. They found that the average company achieved better than a 10% performance improvement in the areas for which goals were set.…..In another study around the goal setting aspects of MBO, the authors found there were three ways to set goals:

1. The boss sets the goals
2. The individual and the boss meet to set goals
3. The individual sets their own goals (within the context of organization goals and priorities)

Interestingly enough, it turns out that the most challenging goals were those set by the individual setting her or his own goals.

And finally, remember to be SMART when setting goals:S = specificM = measurableA = action-planR = realistic (or relevant)T = time-oriented– Peter Scontrino, Ph.D.