Skip to main content

Management by objectives

The term, management by objectives, was first popularised by the management theorist, Peter Drucker, in 1954 in his book "The practice of management". It refers to the process of management and employees agreeing on objectives for the organisation. This is intended to ensure that they understand the objectives, feel that they can be achieved and know their part in that process.

Management by Objectives is not without its critics, however. Some management theorists, including W. Edwards Deming, suggested that the MBO process tends to focus employees on the identified objectives at the expense of other requirements, and that the pressure to complete the identified objectives may result in them being performed poorly. Deming suggests that the setting of objectives is less important than the process of leadership.

Management by objectives is often used to help a firm achieve targets. It is generally considered that objectives set in this way need to be what are called 'SMART 'objectives.

SMART objectives

If you would prefer to view this interaction in a new web window, then please follow the link below:


For some more information on management by objectives and SMART objectives, look at the following links: