Advantages and Disadvantages of MBO


  1. Improved Planning; MBO produces clear and measurable performance goals. A network of goals is created and appropriate action plans are formulated for goal achievement. Research reveals that people tend to set their goals higher than superiors would set them. Joint goal-setting ensures that managers understand their goals. There is effective matching of goals and resources. Clear goals and action plans generate concrete thinking and lead to result-oriented and forward planning. 

  2. Team work; MBO results in better communication between superior and subordinates which reduces conflicts. The whole management team is actively involved in goal-setting. There is integration of lower level goals with organizational goals. Each individual knows clearly what is expected of him. This helps to avoid goals erosion, duplication of efforts and wasted efforts. 

  3. Effective self control; A clear set of verifiable goals provides effective standards for self-control. Managerial efforts are concentrated on critical areas of performance (key result areas). Leadership is freed from the routine task and, therefore, concentrates its efforts and time on piloting the enterprise through the turbulent environment. MBO provides a mechanism by which managers can ensure that enterprise is moving in right direction.

  4. Motivation and Morale; MBO leads to better interpersonal relation through involvement and recognition of peoples at all levels. It provides greater opportunities to make personal contribution and to accept more responsibility. Participative goal setting and two-way communication improve the communication improve the commitment and morale of employees. Superior managers assume a supportive role and subordinates are allowed to exercise self-direction and self-control.

Advantages and Disadvantages of MBO Advantages and Disadvantages of MBO Advantages and Disadvantages of MBO


1 Goal setting problems; Very often it is very difficult to set truly verifiable and measurable goals. Over-emphasis on quantifiable and easily measurable goals may results in neglect of crucial qualitative goals like job satisfaction. Similarly over emphasis on short term goals may be at the cost of long term goals. Focus on end results may results in use of questionable actions. 

2 Time Consuming; MBO requires a great deal of time in setting measurable goals through consensus. In the initial stage several meetings may have to be held to instill confidence in subordinates. The formal periodic reviews and final appraisal sessions also consume a lot of time. 

3 Increased Paperwork; MBO results in a plethora of newsletters, instruction booklets, training manuals, performance reports, etc. Subordinates have to fill in forms and submit detailed reports on their performance. This reduces the effectiveness of MBO. 

4 Inflexibility; MBO may introduce inflexibility in the organization. Once goals are set down, the superior may not like to modify them due to fear of resistance from the subordinates. 

Advantages and Disadvantages of MBO Advantages and Disadvantages of MBO Advantages and Disadvantages of MBO

By Hassham

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