Question

What is meant by the term 'management by objectives'?

• A. A system of giving the authority to carry out certain jobs by those lower down the management hierarchy.
• B. The system of management that is based on bringing together experts into a team.
• C. The setting of objectives to bring about the achievement of the corporate goals.
• D. The control of the organization by those in the 'head office'.

Answer 1

Answer: (C)

The setting of objectives to bring about the achievement of the corporate goals.

Peter Drucker emphasized the important role of goal-orientation in the management process. This line of thought resulted in the concept of Management by Objective.

The concept states that with the help of subordinates, management must formulate clearly defined objectives and develop plans for the achievement of these objectives. Ongoing evaluation should take place to determine whether there is progress in terms of achievement of objectives.