MBO Presentation

Management by Objectives

MBO

Lets wake up

AGENDA- Definition

- Principles

- Process

- Tools

- Cultural Influences

- Advantages & Disadvantages

- Is MBO obsolete?

- New Trends

DEFINITIONBY PETER DRUCKER

DEFINITION OF MBO

Management Model based on Objectives that are agreed on

between Management and Employees

The aim is to reach overall Strategic Goals for the

Organization but also Individual Goals for the Employees

This Model integrates Employees in the planning process what

leads to Participation, Motivation and Commitment

DEFINITION OF MBO

Employees measure their daily

work on their individual goals

and act in best interest of the

company

Sum of all individual goals forms

the overall goal of the company

MBO PRINCIPLES

Setting Goals Together

Periodically Evaluation

Focus on Goals, not on Methodologies

Support from Superior

MBO PRICIPLES

HOW TO

ESTABLISH

GOALS

?

S pecific

M easurable

A chievable

RT

elevant

ime-based

How to be SMART?

SMART GOALS

Get SPECIFIC and clear

about what you want to

achieve!

SMART GOALS – STEP 1

I want to be

rich

Make your goal

MEASURABLE - quantify

what you want !

SMART GOALS – STEP 2

I want to have 1

Billion Dollars

Make your goal

ACHIEVABLE within your

resources!

SMART GOALS – STEP 3

I work hard

as hell

Make your goal

RELEVANT – Is it

worthwhile?

SMART GOALS – STEP 4

I want to keep her

happy

Your goal needs to be

TIMED - Set a start and a

finish date!

SMART GOALS – STEP 5

One year till the

first million

THEMBO’s PROCESS

PROCESS

Routine

Objectives

Problem-Solving

Objectives

Improvement

Objectives

Innovation

Objectives

CENTRAL GOAL SETTING

Development of Individual Goals

Revision of Job Description

Resource Allocation

INDIVIDUAL GOAL SETTING

PROGRESS MONITORED

RESULTS’ REVIEW

- Objectives and key results

- Long and short term priorities

- Scope of assistance expected

- Standards of performance

Self Evaluation

360-Degree

Evaluation

Checklist

Evaluation

Critical Incidents

Method

PERFORMANCE APPRAISAL

Non-Financial

Motivators

Salaries

Commission

Share Ownership

Performance Pay

Financial

Motivators

ACHIEVERS REWARDED

Job Enlargement

Job Rotation

Job Enrichment

Empowerment

TOOLS

Organizational Goals =

Organizational KPI

(e.g. number of complaints in the end of the week)

Individual Goal = Individual KPI

(e.g. weekly % difference in complaints handled that

result in satisfied customers vs. unsatisfied customers)

KEY PERFORMANCE INDICATORS

To achieve

our vision,

how should

we appear

to our

customers?

CUSTOMER

Objectives Measures Targets Initiatives

To satisfy

our share

holders and

customers,

what

business

processes

must we

invest in?

INTERNAL BUSINESS PROCESS

Objectives Measures Targets Initiatives

To achieve

our vision,

how will we

sustain our

ability to

change and

improve?

LEARNING AND GROWTH

Objectives Measures Targets Initiatives

To succeed

financially,

how should

we appear

to our share

holders?

FINANCIALS

Objectives Measures Targets Initiatives

VISION AND

STRATEGY

BALANCED SCORECARD

HOW CAN

CULTURE

INFLUENCE

MBO?

Power Distance Index

Individualism vs. Collectivism

Masculinity vs. Femininity

Uncertainty Avoidance Index

Long vs. Short-Term Orientation

+

+

+

+

+

-

-

-

-

-

HOFSTEDE’s CULTURAL DIMENSIONS

Low Power Distance

Low Uncertainty

Avoidance

High Individualism

High Masculinity

Short-Term

Orientation

REQUIREMENTS OF MBO

ADVANTAGES

AND

DISADVANTAGES

Develops a result-oriented philosophy

No role ambiguity or confusion

Raises employee morale

Improves the appraisal of subordinates

Produces goals that identify expected

results

Allows a continuous monitoring

ADVANTAGES OF MBO

Develops a result-oriented

philosophy

No role ambiguity or confusion

Raises employee morale

Improves the appraisal of

subordinates

Produces goals that identify

expected results

Allows a continuous monitoring

DISADVANTAGES OF MBO

IS MBO

OBSOLETE?

High Volatility in Markets and Trends

Conservative Individual Goals

Non Collaborative Goals = Inefficiency

Having productivity measured is hard

YES! BUT WHY?

LET’S PRACTISE IT !

TASK 2

Paper Planes

Level 1: less than 2 m 5 points

Level 2: 2-5 m 10 points

Level 3: more than 5 m 20 points

Choose which paper you will use before the

game:

Big paper: - 2 points

Normal paper: 0 points

Small paper: + 2 points

TASK 1

Card’s Castle

Level 1: 2 levels high 5 points

Level 2: 3 levels high 10 points

Level 3: 4 levels high 20 points

Choose how many cards you will need

before starting the game

If you need more cards during the game it

costs you half a point

If you have to much cards over when the

time is up it costs you half a point for

every card.

Choose one of the following:

• Everyone of you ever thought about your bucket list?

• Achieved one of the setted objectives?

• Have they been SMART?

Task: Imagine if you would have just 1 year to live

• What would you plan to do in this year. Please write down 6 things (you don‘t have to share that with us)

• What about if you would just have 6 month? ( 3 things)

• 1 month?

• 1 day?

Your Bucket List

NEW TRENDS IN MBO

SKILLS ACTIVITIES

Three types of management

RESULTS

BALANCING RESULTS SKILLS AND ACTIVITIES

SKILLS RESULTS

Traditional MBO Approach

BALANCING RESULTS SKILLS AND ACTIVITIES

New MBO Approach

BALANCING RESULTS SKILLS AND ACTIVITIES

SKILLS RESULTSACTIVITIES

As Peter Drucker said, “you can only

manage what you measure” and “what

gets measured gets done”.

GAMIFICATION: A NEW WAY TO EMPLOYEE ENGAGEMENT

Measurable goals are crucial for

organizational success

Inspire mastery, commitment

and higher performance rates

Keep employees focused on

results.

GAMIFICATION: A NEW WAY TO EMPLOYEE ENGAGEMENT

The problem is:

With those set for lower

levels employees

Managing Staff objectives

are not always in line…

Is here where

gamification

can intervene

GAMIFICATION: A NEW WAY TO EMPLOYEE ENGAGEMENT

But what is gamification?

GAMIFICATION: A NEW WAY TO EMPLOYEE ENGAGEMENT

What does it bring to the table?

Act as tool to realign employees

with corporate goals

Keeps workplace competition

under control

Establishes a feedback system

that individually rewards

employees

GAMIFICATION: A NEW WAY TO EMPLOYEE ENGAGEMENT

How?

GAMIFICATION: A NEW WAY TO EMPLOYEE ENGAGEMENT

Challenge: Increase sales

training program participation

Solution: Motivate through

rewarding exploration and

knowledge demonstration in

an online collaborative

community

GAMIFICATION: FORD CANADA AND BUNCHBALL EXAMPLE

Examples of Tools Used

- Badges and virtual trophy

case

- Different levels of

performance for tasks

and missions

- Individual and team

leaderboards

- Virtual Dream garage

GAMIFICATION: FORD CANADA AND BUNCHBALL EXAMPLE

RESULTS

- 100 000 unique visits to the

platform

- User activity increased 60%

- Impact on sales

GAMIFICATION: FORD CANADA AND BUNCHBALL EXAMPLE

André Campino, Diogo Vasques, Katharina Erdrich, Eric Stange,

Miguel Saúde, Soraia Vale

Thank you for your attention.