3 important merits of Management by Objectives:

Management by objectives fixes the goals and allows freedom for the managers and their subordinate staff to achieve the goals. Hence, it has become an important tool of modern management.

It is result oriented and leaves the burden of the top managers in the day to day performances. For the managers it avoids the interference from the top as they are allowed to achieve the goals using their own discretions.

1. Involvement of the Personnel:


Under the MBO principle, the personnel at all levels are involved to frame the objectives of the organisation are framed. After delegating certain power and freedom, they are made to involve themselves, with the achievement of the objectives.

Involvement towards a common goal has been pointed out by Drucker as, “any business enterprise must build a true team and weld individual efforts into a common effort.

Each member of the enterprise contributes something different, but they must all contribute toward a common goal. Their efforts must all pull in the same direction and their contribution must fit together to produce a whole -without gaps, without friction, without unnecessary duplication of efforts”.

2. Orderly Growth of the Organisation:


MBO ensures orderly growth of an organisation as systematic approaches are given to achieve objectives. Everyone’s duties and responsibilities are fixed and they are measured.

3. Motivation of Managers:

Peter Drucker views that one of the greatest advantages of MBO is it make it possible for a manager to control his own performance. Self control connotes motivation, a desire to do the best. This paves the way for higher performance goals, and broader vision.

“It motivates the manager to action not because somebody tells him to do something or talks him into doing it, but because the objective needs of his task demand it. He acts not because somebody wants him to but because he himself decides that he has to act, in other words, as a free man”.