Copyright ©1995-2003
by Ethan A. Winning
I've been an advocate of Management By Objectives (MBO) since I first met George Odione in 1969. For the past few years I've been catching a lot of flak for such advocacy. "MBO is passè." "You can't measure performance by using MBO." "Why don't you get with the times and concentrate on new performance appraisal systems?" As to MBO being old-fashioned, okay, but it isn't obsolete. Unlike many management fads of the 60's and 70's, there is still a lot of value in setting objectives. MBO should not be lumped together with assessment centers, transactional analysis, (many parts of) organization development, and The Managerial Grid. Those were fads which, for several thousand dollars a pop, gave us a new vocabulary but little else. MBO, on the other hand, still remains a good proactive mechanism to be used within the processes of planning and control.
Although I include a section on objectives-setting in my performance reviews, I never said it was the method for evaluating performance. (Ah, maybe there's the rub.) As Thomas H. Patten, Jr. noted, "In most work organizations in America employee performance is not measured but rather is evaluated or appraised."1 Let's face the fact that most performance cannot be measured and is evaluated based on a number of questionable but real criteria including personal characteristics such as "loyalty," "appearance," and "demeanor" or "attitude." Many supervisors or managers appraise performance based in part on how well an individual meets the supervisor's own personal/professional agendas. (This is not a criticism; it's part of human nature. We have an partiality for those who are perceived to be most like us and vice-versa.)
Yes, rating the performance of others is at times, at least in the service sector, quite subjective. In many industries, that's the way it has to be. For example, would you rather rate a surgeon on the number of operations performed on a given day or on the survival of the patients on which the surgeon operates?
If MBO is outmoded just because it's old, I wonder what your thinking is about the over-50 group in your organizations!
1. Human Resource Management, Winter 1976, p. 3