It is rightly said that knowledge of basic motivation process can be applied to management science.

Management by objective a tool for motivation the idea which was initiated by Management Guru Peter Drucker in 1957. The main objective behind the concept was to motivate people rather than to control.

The MBO concept works in the following way:

MBO works from bottom up as well as from the top down. In this process organization overall objective are translated into specific objective from each level i.e. divisional, departmental, individual.

There are four common factors in MBO program

i.            Goal specificity

ii.            Participative decision making

iii.            As explicit time period

iv.            Performance feedback

In this program the superior and subordinator jointly choose the goal and agree on how they will be measure and also decide the time line to achieve the desired goal


MBO as a widely use program in the corporate sometime fails to meet management expectation. These failures are due to unrealistic expectation, lack of top management commitment, inability or willingness by management to allocate reward based on goal.

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