The key to successful employee empowerment is the free flow of information throughout the organization. The MBO was developed based on the belief that employees perform better when they understand what is expected of them. It allows the employee to associate their individual efforts with the objectives of the organization. Peter Drucker first popularized management by objectives (MBO), also known as management by planning (MBP), in his 1954 book The Practice of Management.
Objective management is the process of defining specific objectives within an organization that management can convey to the members of the organization and then deciding how to achieve each objective in sequence. This process allows managers to address the tasks that need to be done step by step to create a calm and productive work environment. In this management system, individual objectives are synchronized with the organization's objectives. In the book that coined the term, Peter Drucker established several principles.
Objectives are set with the help of employees and are designed to be challenging but achievable. Employees receive feedback on a daily basis and the focus is on rewards rather than punishments. Emphasis is placed on personal growth and development, rather than on the negativity of not achieving goals. The limitations mentioned above, combined with the challenges faced by modern service companies, have led to the development of methods that integrate aspects of business management, but that appear to be significantly more effective in their application.
The strategy was formulated by Peter Drucker in the 1950s, following five steps that organizations should follow. While it may be tempting to take on all of the “important” tasks as a manager, knowing how to delegate responsibility can empower the team and awaken their own sense of responsibility. Howard Bowen, an American economist, can be credited with relating corporate responsibility to society in his 1953 book The Social Responsibilities of the Entrepreneur, but it was Drucker who introduced CSR as an integral part of business strategy and management. It deals with converting an organizational objective into a personal objective based on the assumption that setting personal objectives causes the employee to commit, which leads to better performance.
The group of management techniques that are based on objectives, with a strong focus on commitment, team motivation and leadership, can be summarized as methods of management by objectives. By implementing Drucker's human-centered management theory, business owners and managers can create a sustainable and nurturing work environment that benefits the company's development, objectives, and long-term growth. Companies around the world have used Drucker's ethical approach to management for the past 80 years, and for good reason. It is a control system in which the jointly developed business objectives are aligned with the company's objectives.
Management by objectives is still practiced today, with a focus on planning and development to help various organizations. Peter Drucker is an influential Austrian-American author, mentor, and consultant, considered the father of modern business management. The management of the IT company Hewlett-Packard (HP) has said that it considers this policy to be a fundamental component of its success. In many large Japanese companies, starting in the late 1990s, the MBO was used as the basis of the performance-based merit system (seika-shugi), which used clear numerical objectives to measure performance, unlike the previous system of non-specific contracts of Japanese companies.
Using his extensive experience as a consultant in companies such as IBM, General Motors and Procter & Gamble, Drucker wrote The Practice of Management in 1954, where he presented a holistic approach to operating an organization and introduced a business management discipline, the first in the history of business...
Leave a Comment