Welcome
Training Course on
Management By Objectives
Management by Objectives (MBO)
Management by objectives (MBO) is a systematic and organized approach that allows management to focus on achievable goals and to attain the best possible results from available resources.
Why MBO
The MBO is appropriate for knowledge-based enterprises with competent team having following objectives: To achieve a balance between Management
and Employee EmpowermentManaging for ResultsIndividual ResponsibilitySolve problems and reduce “future shock”·Recognize that goal setting is an artUse subordinates properly and profitably in goal setting
Shift from Management to Leadership
“Management works in the system. Leadership works on the system.”
- Stephen R. Covey
Effective LeadershipAttributes x Results = The Roadmap for Improving Leaders
New Managers for New Economy
The New Manager
Classical Managerial Work New Leadership Task
Planning Creating vision & Empowering
Measuring and controlling
Organizing the hierarchy
Inspiring & Coaching
Aligning the web of relations
Traditional One Vs New Management Model
Traditional Model New Model
Managing Assets Managing Resources & Capabilities.
Built around assets Built around Capabilities
Focus on Managing Numbers Focus on Creating Value
Hierarchical Networked
Independent Parts Interdependent parts
Reactive Responsive
Rationality & Analysis Intuition & Analysis
Risk Averse Blame Culture Encouraging radical Ideas and Risk Taking
Lead More, Manage Less
LeadManage lessArticulate your visionSimplifyGet less formalEnergize othersFace realitySee change as an opportunityGet good ideas from everywhereFollow up
Build A Winning Organization
Get rid of bureaucracyEliminate boundariesPut values firstCultivate leaders
Create learning culture
Harness Your People
Involve everybodyMake everybody a team playerStretchInstill confidenceHave fun
Yin Yang of effective Management
Yang (Active, Creative)Brain Storming
Yin (Passive, Receptive)Brain Stilling
Business Efficiency Business Effectiveness
Spotting and pursuing opportunities Taking the bird’s eye view of your business strategies
Making fast decisions and implementing them under the time pressure
Building and balancing your business system
Innovating and creating outside the box solution
Harmonizing men, material and methods to achieve sustainable growth, human development and social benefit
Key qualities of business leaders
Emanate personal characterMaster competenciesSet directionsBuild organizational capabilityMobilize individual commitment
Becoming a knowledge enterprise
In tomorrow's business environment, Knowledge and How it is managed for competitive advantage is the number one corporate priority
Knowledge enterprise versus Industrial Enterprise
INDUSTRIAL ENTERPRISE KNOWLEDGE ENTERPRISE
Economies of scale Smaller business units
Standardization of work Customization of work
Standardization of workforce Flexible, multi-skilled workforce
Financial capital as scarce resource
Human capital as scarce resource
Corporate HQ as operational controller
Corporate HQ as advisor & core competency guardian
Hierarchical pyramid structure Flat or networked structure
Employees seen as expense Employees seen as investment
Internally focused top-down governance
Both internal and external distributed governance
Information based on "need to know"
Open & distributed information system
Vertical decision making Distributed decision making
Emphasis on stability Emphasis on change
Emphasis on vertical leadership Emphasis on empowered self-leadership
Sources of Knowledge
Customer knowledge:Customer needs, perceptions, and motivationsWho to contactCustomer buying powerWhat differentiation strategy and customer services need to be developed to win and retain customers
Sources of Knowledge
Competitor knowledge What competitors are selling now and
what they are planning to sell in the future
What is their strategic intentWhat competitive strategies they use
to win in the marketplace.
Sources of Knowledge
Service knowledge The Services in the marketplaceWho is buying them and whyWhat prices they are selling atHow much money is spent on such
Services now and may be spent in future.
Sources of Knowledge
Process knowledge Best practicesTechnology and ForecastingSystemic, Cross-functional synergy
opportunities
Sources of Knowledge
Financial knowledge Capital resourcesWhere and at what costThe integration in financial practices
Sources of Knowledge
People knowledge: Knowing people and what motivates
employees, Obtaining feedback The expertise available How to go about finding experts
Managing Knowledge Workers
To lead knowledge workers effectively and unlock their true potential, you need to define:
What knowledge work professionals do? How they do it best? What drives them to do it?
Creativity defined
Resource x Motivation x Creative Thinking Skills'Creativity is the juxtaposition of ideas which were previously thought to be unrelated.' It is your ability to combine ideas in a unique way or to make useful associations among ideas.
ResourcesKnowledgeExpertise Access to relevant Information
Internal MotivationMotivation from within; your
need or passion to be creative
Creative Thinking SkillsCapacity to think outside the box
&Put existing ideas together in new
combination
The Creative Thinking Process
Preparation Incubation Insight Validation
The Creative Thinking Process
Preparation
Collecting and sorting the relevant information Analyzing the problem thoroughly Exploring possible solutions
The Creative Thinking Process
Incubation Mental work – analyzing, synthesizing,
imaging, and valuing – continues in your subconscious mind
The parts of the problem separate and new combinations occur
The Creative Thinking Process
Insight
A new idea emerges into your conscious mind, either gradually or suddenly - often when you are in a relaxed frame of mind and are not
thinking about the problem
The Creative Thinking Process
Validation
Thorough testing of a new idea, insight, intuition, hunch, or solution
Rules of creative thinking
Don't let assumptions stifle your capacity. Throw every one of them. Discipline yourself to take time to look for alternatives. Stay open and generate as many as you can think of before deciding on one. To get solutions, you must create an atmosphere where you and others are comfortable expressing new ideas (even if you make mistakes by coming out with bad ideas), an atmosphere where ideas are not immediately evaluated and attacked. To open up true creativity, you have to shed inhibitions and move from left-brain – dominated by numbers – toward right-brain – the original thinking. If you are working on a problem and getting nowhere, leave it for a while and let your subconscious – your depth mind – to take over
Five steps to unleashing your creativity
Gather material Turn the facts over in your mindLet your subconscious take over for a whileAn idea will occur Examine the idea in the harsh light of reality
Creative thinking Tips
If you are thinking along a certain line and nothing happens, stop. Analyze the problem again and see if you can come up with a new approach. Break out of self-imposed limitations. Look for wider solutions, 'think beyond the square'. Think sideways; explore the least likely directions; abandon step-by-step approach and thinking 'to one side' and master the 'lateral thinking' approach. Sharpen your brain – communicate and exchange ideas with other creative people as often as you can. This is useful not only for stimulating idea generation but also for giving you an opportunity to validate your ideas through professional colleagues. If you are working on a problem and getting nowhere, leave it for a while and let your subconscious – your depth mind – to take over
Comparison of lateral thinking vs. Vertical thinking
Vertical Thinking Lateral Thinking
Chooses Changes
Looks for what is right Looks for what is different
One thing must follow directly from another
Makes deliberate jumps
Concentrates on relevance Welcomes chance intrusions
Moves in the most likely directions Explores the least likely directions
Distinguishing between data, Information and Knowledge
Data Information Knowledge
Symbols or facts out of context, and thus not directly nor immediately meaningful
Data placed within some interpretive context, and thus acquiring meaning and value
Meaningfully structured accumulation of information; information that is relevant, actionable, and based at least partially on experience
Distinguishing between Explicit and Tacit Knowledge
Explicit knowledge - Tacit knowledge
Can be formally articulated or encoded; can be more easily transferred or shared; is abstract and removed from direct experience
Knowledge-in-practice; developed from direct experience and action; highly pragmatic and situation specific; subconsciously understood and applied; difficult to articulate; usually shared through highly interactive conversation and shared experience.
Application of Tacit Knowledge in Innovation
Problem solving Experts, as opposite to novices, can
solve a problem more readily as they have in mind a pattern born of experience, which they can overlay on a particular problem and use to quickly detect a solution
Application of Tacit Knowledge in Innovation
Problem finding Linking a general sense of intellectual or existential
unease to radical innovation: creative problem framing allows the rejection of the "obvious" answer to a problem in favor of asking a wholly different question. Intuitive discovery is often not simply an answer to the specific problem but an insight into its real nature
The MBO Process
Define corporate objectives at broad Level
Establish management information systems to monitor
performance
Analyze management tasks and devise job specifications
Set Performance Standards
Set subordinate objectives
Align individual targets with corporate objectives
Define corporate objectives at broad Level
VisionMissionGoals
StrategiesAction Plans
Strategy PyramidTop Down
Strategy StretchTop Down +Bottom up
Strategic intent
Challenge
Opportunities
Vision
Vision is a short, succinct, and inspiring statement of what the organization intends to become and to achieve at some point in the future, often stated in competitive terms. Vision refers to the category of intentions that are broad, all intrusive and forward thinking. It is the image that a business must have of its goals before it sets out to reach them. It describes aspirations for the future, without specifying the means that will be used to achieve those desired ends.
Mission Statement
A mission statement is an organization's vision translated into written form. It makes concrete the leader's view of the direction and purpose of the organization. It is a vital element in any attempt to motivate employees and to give them a sense of priorities.
A mission statement should be a short and concise statement of goals and priorities.
Setting Goals
A goal is a long-range aim for a specific period. It must be specific and realistic. Long-range goals set through strategic planning are translated into activities that will ensure reaching the goal through operational planning.
Setting Objectives
Setting objectives involves a continuous
process of research and decision-making. Knowledge of yourself and your unit is a vital
starting point in setting objectives.
Corporate Strategy
Strategy is the way in which a company orients itself towards the market in which it operates and towards the other companies in the marketplace against which it competes. It is a plan an organization formulates to gain a sustainable advantage over the competition.
Strategic Intent
A strategic intent is a company's vision of what it wants to achieve in the long term. It must convey: A significant stretch for your company A sense of direction, discovery An opportunity that can be communicated as
worthwhile to all employees "To achieve great things, you need ambitious visions.
And it does not matter that vision cannot be laid out in details. It is the direction that counts."
Choosing Between Strategy and Opportunity Approach
Use Strategy Approach Use Opportunity Approach
Known environment Unknown environment
Building on existing competencies, capabilities, products, markets
Building on new competences, capabilities, products, markets
Need consolidation Need rapid growth
Need stability and certainty Need change, accept uncertainty
Lack capacity for flexibility, corporate venturing, and speed
Established capacity for flexibility, corporate venturing, and speed
Knowing Oneself; Unlocking Your True Potential
Workshop