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Performance Management

Management by Objectives

A goal-setting framework where managers and employees jointly set measurable objectives.

Full Definition

Management by Objectives (MBO) is a goal-setting framework introduced by Peter Drucker in which managers and employees jointly define specific, measurable objectives aligned with organizational goals. Performance is evaluated at the end of the period based on achievement of agreed objectives. MBO promotes clarity, accountability, and alignment between individual and organizational goals. While OKRs have become popular in tech companies, MBO remains widely used in traditional industries and government organizations.

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