MBO is more than a performance evaluation technique. It is also a philosophy of management which focuses on developing long range objectives, focusing on results rather than activities, increasing employee participation and developing employee competence. Employee lists key performance objectives and dates for accomplishing them. Supervisor and employee discuss the objectives and develop a set of agreed-upon objectives. Supervisor and employee meet quarterly to review progress and revise objectives as needed.
Employee prepares a year-end summary, comparing accomplishments with objectives.
The supervisor and the employee discuss the employee s self-assessment and compare it with the supervisor s assessment. The reasons for objectives not being met are identified, and possible solutions are discussed. A new set of objectives is established for the next year and the MBO cycle continues. MBO is one of the most widely debated management topics of the last 25 years. MBO improves employee participation in the evaluation and development process.