Tuesday 10 July 2012

Problems and Limitations of MBO

Some of the common problems of MBO are as follow:

1) Time and Cost:
                     It is a process which requires large amount of the most scarce resource in the organisation and time of the senior managers. Sometimes managers get frustrated and feel overburdened.
2) Failure to teach MBO Philosophy:
                     Management often fail to understand and appreciate this new approach. MBO demand rigorous analysis as an integral element of the management process but the organisation may not be used to rigour.
3) Problems in Objective setting:
                     Setting of verifiable objectives is difficult atleast in some areas. Objectives are more in the form of statement rather than in quantitative form.
4) Emphasis on short-term objectives:
                     Sometimes, in order to be more precise there is a tendency to emphasise on short-term objectives usually for a year or even less. There is a danger in emphasizing short-term objectives at the cost of long terms objectives.
5) Inflexibility:
                     In a dynamic environment, a particular objective may not be valid for even, in the context of revised objectives, changed premises, it is useless to follow the old objectives. Thus inflexibility created by applying MBO may cause harms.
6) Frustration:
                    Sometimes MBO creates frustration among managers, because it tends to arouse high expecation forrapid change, particularly among the young and junior managers.
               

                  Inspite of these obstacles MBO continues to be a way of managing the organisation problems of MBO can be over come by implementing it properly.

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