|Management by objectives (MB) is considered as the best method for performance evaluation. Most of the traditional methods of performance appraisal are subject to the antagonistic judgment of the rates. It was overcome this problem; Peter F. Drucker propounded a new concept, namely, management by objectives (MBO). The concept of MBO described as a|
- Goal Setting: Goals are set which each individual is to attain. The superior and subordinate jointly establishes these goals. The goals refer to the desired outcome to be achieved by each individual employee.
- Performance standards: The standards are set for the employees as per the previously arranged time period. When the employees start performing their jobs. They come to known what is to be done, what has done, and what is to be done, what has done, and what remains to be done.
- Comparisons: In the third step, the actual levels of goal attained are compared with the goals agreed upon. This enables the evaluator to find out the reasons for variation between actual and standard performance. Such as comparison helps devise, training needs for increasing employees performance.
- Periodic review: Finally, in the periodic review step, corrective measure is initiated when actual performance deviates from the standards established in the first step-goal-setting stage. Consistence with the MBO philosophy, periodic progress reviews are conducted in a constructive rather than punitive manner. The purpose of conducting reviews is not to degrade the performers but to aid in his/her future performance.