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A REVIEW OF THE IMPLEMENTATION OF
MANAGEMENT BY OBJECTIVES IN A LARGE SUBURBAN
SCHOOL DISTRICT

Dissertation for the Degree of Ph. D.
MICHIGAN STATE UNIVERSITY
DAVID L JOHNSON
1976

 

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A REVIEW OF THE IMPLEMENTATION
OF MANAGEMENT BY OBJECTIVES

IN A LARGE SUBURBAN SCHOOL DISTRICT

BY

David L. Johnson

AN ABSTRACT OF A DISSERTATION

Submitted to
Michigan State University
in partial fulfillment of the requirement

for the degree of

DOCTOR OF PHILOSOPHY

College of Education

1976

ABSTRACT

A REVIEW OF THE IMPLEMENTATION OF MANAGEMENT
BY OBJECTIVES IN A LARGE SUBURBAN
SCHOOL DISTRICT

By

David L. Johnson

The purpose of this case study was to review the circumstances
leading to a suburban Board of Education decision to employ an outside
management consultant and then to implement the business system known
as Management By Objectives, and finally, and most importantly, to
elicit and assess the perceptions regarding this system of the involved
administrators.

The time, cost and consequences of implementing a large-scale
system such as MBO are potentially so great that extreme care must be
taken to minimize factors which would deter or reduce effective system
integration as viewed by those personnel directly involved. This study
has isolated some perceived factors which appear to have affected the
outcome of a specific application of NBC in a particular school district.

Until the time of this study, no assessment or evaluation of
implementing or maintaining MBO in this school district had taken place.
The data was collected through in-depth interviews with each of the admin-

istrators who had been involved since the inception of the system.

David L. Johnson

Their judgements, evaluations, perceptions as to degree, and also
the extent to which they appeared or indicated to have internalized
the process, was sought and recorded during the questioning.

The review of MBO literature reveals a primary focus upon the
mechanics or techniques of making the system work as Opposed to viewing
management by Objectives as a philosophy of management based upon an
understanding of human nature. The review includes a look at the
fundamental concepts underlying MBO and describes it as not only a
decision-making technique but as also based on the human aspects of
the management process to improve the performance of the individual
manager who operates in a complex web of human relationships with
fellow managers.

Many applications are recorded in the literature of the
implementation of NBC and numerous sets of initiating guidelines
exist. There are, however, many fewer illustrations of successful
maintenance of MBO. It appears that several important factors exist,
in fact, that tend to hinder the implementation as well as the mainte-
nance of this process, chief among which are lack of high-level commit—
ment and a lack of means for adaptation and modification to occur as
circumstances warrant.

In addition to a review and analysis of interview responses,
used to generate conclusions, it was possible to comment upon the
structural techniques used by the consultants as well.

Based on the perceptions of the administrators involved
in the interviews, it was concluded that: l) the original purposes

for implementing MBO had not effectively been met and its status

David L. Johnson

appeared to be deteriorating; 2) generally, participating staff
viewed MBO as malfunctioning or nonexistent; 3) they believe MBO
to be a process which interferes with their regular work routines,
and; u) by and large they feel it has or is disintegrating through
a lack of organizational objectives, coordination, in—service and

communications.

A REVIEW OF THE IMPLEMENTATION
OF MANAGEMENT BY OBJECTIVES

IN A LARGE SUBURBAN SCHOOL DISTRICT

Bv

David L. Johnson

A DISSERTATION

Submitted to

Michigan State University

in partial fulfillment of the requirement

for the degree of

DOCTOR OF PHILOSOPHY

College of Education

1976

 

_..p..

nut.

 

ACKNOWLEDGEMENTS

There remains no doubt to this writer that the patience and
encouragement of one's committee is of unusual importance in the
making of dissertations and degrees. Dr. Stanley Hecker, Chairman,
Dr. Richard Featherstone, Dr. James Costar, and Dr. Michael Moore,
are gratefully acknowledged as sources of major assistance throughout
this endeavor.

Dr. Hecker in particular, through his commitment in time,

advice and responsible guidance, was a continuing source of motivation.

ii

TABLE OE CONTENTS

Page
ACKNOWLEDGEMENTS... ......................................... ii
Chapter
I. INTRODUCTION.. .......................... . .......... 1
Introduction to the Problem ...................... 1
Purpose of the Study ............ . ................ 7
Background of the Prdblem ...................... .. 8
Conception of Organizational Management.......... 9
Significance of the Study........................ 18
Methods and Procedures ................ ........... 19
Terminology. OOOOOOOOOOOOOOOOO O ....... O O O O O O O O O O O O 21
Delimitations ................. . ......... . ........ 22
II. REVIEW OF THE LITERATURE ........................... 2H
Management By Objectives Concept ................ . 2H
Underlying Principles.............. .............. 27
Element of Participation......................... 36
Implementation Outcomes.. ....... ................. 37
Maintenance Implications................. ........ H3
Implementation Guidelines ......... . .............. #7
Chapter Summary.... .............................. 55
III. RESULTS OF THE INTERVIEWS .......................... 57
The Eastwood Plan of MBO.. ........ . .............. S7
The Process of Management By Objectives ....... ... 61
Perceptions of Process................. ...... .... 71
Perceptions Regarding "Others” ..... .............. 76
Consistency of Perceptions.......... ............. 77
Perceived Change Factors ......................... 79
Perceptions Regarding Effectiveness .............. 81
Perceived Need for Modification .................. 83

iii

Chapter Page

IV. ANALYSIS, CONCLUSIONS AND RECOMMENDATIONS .......... RR
Analysis of Interview Responses.................. 88

Overall Perceptions of Process .................. . 90

Perceived Acceptance by Others ................... 91
Perceptual Alteration Over Time ....... . .......... 91
Perceptions of Evolutionary Deterioration ........ 92
Suggestions for Modification ........ .... ......... 92

Analysis of Consultant Technique ................. 93
Conclusions..... ..................... ... ......... 98
Recommendations..... ........ ........ ............. 101
BIBLIOGRAPHY.... ..... . ....................... ..... .......... 103
APPENDIX ....... .... ......................................... 106

iv

CHAPTER I

INTRODUCTION

Introduction to the Problem

 

On November 1, 1968, the Board of Education of a large metro-

l to implement

politan Detroit area school district, took official action
a program of management by objectives. This action included a restruc-
turing of internal administrative relationships, a new compensation and
merit pay program as well as a structured objective and goal—setting
process.

The Board of Education was assisted in the development of this
plan by an outside management consulting firm, West and Company, Inc.,
Chicago, Illinois.

The local administrative conditions which, in large part,
precipitated this action are contained in a report2 prepared by the
consulting firm and are as follows:

1. "Responsibilities and authorities were not prOperly

delegated to the individuals or departments required
to make decisions.

2. The increasing independence of departments resulted

in decreasing cooperation between departments and

functions and a predominance of 'we' and 'they'
attitudes.

 

lEastwood (Michigan) Public Schools, Minutes of Meeting of
the Board of Education, Meeting of October 30, 1968, (Mimeographed).

2West and Company, Organization, Compensation and Management
By Objectives Studies, Chicago, January 31, 1969, (Mimeographed).

 

 

l

In

It became progressively more difficult to differen-
tiate between positions through use of the current
Management Plan as positions changed and new positions
evolved.

Rapid increases in the salary structure allowed the
granting of large increases in salary to individuals
without regard to merited perfOrmance.

Salary pressures were exerted upon management based
on internal inequities without regard to market rates
and monetary incentives.

Inappropriate technique and instructions for personnel
appraisal resulted in superior and subordinate misunder-
standings. Too often, documentation was provided only
to substantiate review conclusions and, generally,
projects and activities for performance improvement
were undirected by the supervisors."

View of these considerations, the Board and Superintendent

concluded that a full study and review of the organization, management

and salary plan was warranted and timely. The first step taken by the

consultants was a document review of the current plans and past studies.

This review disclosed several weaknesses, the more important of

which are listed by West as:

1.

Department and individual responsibilities and
decision-making authorities were shared, or not
entirely documented or properly delegated.

The job descriptions, in a number of cases, did
not adequately describe the duties performed by
the incumbent.

The salary adjustment procedures, which were tied to
teadher salaries and automatic increases, were becoming
unrealistically rigid and offered limited managerial
discretion.

Employee performance was not consistently being
measured in an objective and motivational manner.

3Ibid.

The administrative "climate" during the year or two preceding the
intervention of West and Company was far less than desirable, based on the
observations of those most closely associated with the organization.

There appeared to be considerable dissatisfaction on the part of the Board
of Education with the overall management of the district and, in particular,
with the administrative compensation plan patterned closely after an "index"
commonly used in teacher salary schedules and implemented without regard

to individual performance.

There also appeared to exist a high level of frustration and
dissatisfaction among lower and middle—level administrators with upper-
level management. This frustration and concern centered on organizational
inertia, a lack of clear direction and insufficient communication between
departments and divisions.

In any case, after the consultants' document review and delineation
of major weaknesses, West and Company, with the Superintendent and the
Board, established the following as primary reorganization objectives:

1. Develop the best overall plan of organization

which would facilitate future growth, enhance
the economics of specialization, delineate
responsibility, authority and controls and
provide for individual accountability.

2. Reevaluate all positions and place them in a

graded structure which would provide fair and
competitive compensation.

3. Develop a "merited" compensation plan.

u. Install a Management By Objectives program with
the appropriate documentation and appraisal tools.”

The major project effort began in July, 1968. The district,

iIIJune of the same year, consisted of 2u,eoo students, 31 buildings,

”Ibid.

 

1,139 teachers and 86 administrators. The consultants again reviewed all
pertinent documents relative to policies, job descriptions, evaluation
and salary procedures and the organization structure.

In addition, they conducted fifty-five interviews which included
the Board of Education, the Superintendent, all available administrative
personnel in the Central Office, and a sampling of elementary and second—
ary principals. The interviews covered the incumbent's definition of his
responsibilities and authorities, working relationships, projects, plans,
problems with the district, plus an appraisal of his superior, himself
and his subordinates.

On the basis of the interviews and in-depth review, it was deter—
mined that:

l. Timely decisions were not being mudo.

2. Operating decisions and problem analysis
tended to drift to superintendent level.

3. Personnel did not always have a clear under-
standing of their responsibilities.

4. Many decisions were deferred to committees.

5. The lack of functional accountability contributed
to functional independence and reactive action.

6. Personnel were unclear about the activities
of other departments.5

The consulting agency developed a series of recommendations which
were reviewed and approved by the Board of Education and Superintendent.

Among them were:

1. Establish a flatter and more decentralized organization
fixing operational responsibility and authority with the
Superintendent's immediate subordinates.

2. Establish and implement Management By Obgectives
throughout the administrative hierarchy.

 

Ibid. Ibid.

 

 

In addition, the consultant agreed to review and rewrite all job

descriptions in a standard business format and tO completely restructure

the administrative salary schedule in terms Of "market competition" for

jobs at all levels and relate the new compensation procedures to

Management By Objectives.

Because the perceptions and behaviors Of participating admin-

istrators toward this program Of MBO is the subject of this paper, it

is appropriate here to include the purposes and benefits Of the system

outlined by the consultants as reported to the Board of Education in

their final report:

"For some time, the Superintendent and Board Of Education
have recognized the need to:

1.

2.

Improve planning and coordination Of effort;

Maintain an organization structure which is
adaptive to growth and change;

Clearly designate fUnctional and individual
responsibilities;

Improve communications between divisions and
departments and between Central Office and
school buildings;

Identify individual contributions and develop-
ment needs.

”West and Company recommends that Eastwood Public Schools
should undertake a program Of Management By Objectives to
appraise the performance Of individual administrators.
However, if properly implemented, MBO will also enhance
other aspects Of administration in the school district.

"Long and short-range planning will be improved by the
establishment Of major district-wide and divisional
Objectives. These will provide the basic framework fOr
administrative effort throughout the coming cycle period.

"The MBO cycle also calls for a periodic review Of the organ—
ization structure. This review should be made in light of
established Objectives and be revised in order to facilitate
the most effective attainment Of these Objectives. Functional
and individual responsibilities can be better clearly defined
as a result Of this continuous review.

"Communication is enhanced in many ways. First, the cycle
requires that plans and Objectives be communicated downwards
and laterally so that goals can be established. Individual
goals are to be communicated upwards so that an administrator
can be appraised in a reasonably Objective manner. Secondly,
an effective translation Of goals into projects, requires

that careful attention be given to the coordination required
with other departments or divisions whose contribution is
necessary to the attainment Of the goal; this is to be done
during advance planning stages. Thirdly, the cycle requires
that some form Of interim review Of results against plans be
made between the administrator and his superior. This interim
review is made to ensure that administrative activities are
consistent with plans and that adjustments are made for any
intervening variables which had not previously been identified.

"Another requirement of the MBO cycle is that there be a final
review Of the performance of an administrator based on achieved
results as compared with established goals. Performance strengths
are identified as are personal development needs. This review
provides a sound basis for recommending salary considerations,
preparing a development action plan, identifying promotable
talent or identifying personnel requiring transfer or
termination."

The role Of the consultant in implementing this management system,
again by their own words in their report, was:
1. TO train the Board of Education and administration
through the third level of management in the

concepts and methodology.

2. TO assist in the development Of long-range plans and
Objectives.

3. To assist in the development Of divisional objectives.

4. TO assist in the development Of goals for each
administrator through the third level.

 

7Ibid.

5. TO assist in deveIOping an understanding Of
the interim review and final performance
appraisal process.8

In order to accomplish this, they indicate they spent about
seventy percent of their time on individual counseling, primarily at the
superintendent and cabinet level, in the mechanics of goal setting. The
other thirty percent of their time was spent in group training sessions
to develop a basic understanding Of concepts, processes and methodology
Of MBO. ‘

At the time of its inception, November, 1968, and until October
Of 1969, the MBO program involved all 106 of the district's administrators.
At that time, October, 1969, eighty—five administrators, including all
assistant principals, principals and most lower-level Central Office
staff, withdrew from participation in the program and organized them-
selves into a collective bargaining unit in which salary increases
were based on experience and were awarded according to a negotiated
schedule.

The remaining twenty-one administrators, declared "exempt" from
the bargaining unit by a federal arbitrator, continued to participate
in and implement the MBO program. Since November, 1968, eight Of the
original twenty-one "exempt" administrators have either retired or moved
out Of the district. Thus, at the time Of the study, thirteen admin-
istrators remained who had been continuously involved in the program

since it began.

Purpose of the Studyg

 

The purposes of this study are threefold:

 

8Ibid.

 

1. To elicit and record the perceptions, Observations
and Opinions Of this particular plan Of MBO by those
administrators in the school district who had personally
and functionally participated in its implementation and
practice since the program's inception on November 1, 1968,
until the time Of the study.

2. TO conclude, based on the recorded perceptions,
Observations and opinions, whether the process of
implementation of Management By Objectives was
generally successful or unsuccessful in the minds
Of the participants, and;

3. To determine which implementation factors appeared

to be instrumental in shaping the perceptions,
observations and Opinions Of the involved administrators.

Background Of the Problem

The importance that clear goals and Objectives play in the
success Of any type Of organization would be difficult to overemphasize.
Etzioni9 suggests that goals perform four basic functions:

1. They set down the guidelines for organizational
activity.

2. They constitute a source of legitimacy which
justifies the existence Of such an organization.

3. They provide orientation by depicting a future
situation which the organization strives to
obtain.

9. They serve as standards by which both members and
outsiders may assess the progress and success Of
the organization.

Educational institutions have Performed reasonably well in the

setting of goals as enumerated in the first two categories above.

 

gEmitai Etzioni, Modern Organizations, Foundations of Modern
Sociology Series, (Englewood Cliffs, New Jersey: Prentice Hall, Inc.,
1969), p. S.

 

In all probability, they equal the quality Of the goal-setting
activities in businesses, hospitals, government agencies, and
other large organizations. The latter two categories find many
educational institutions with recognized shortcomings. While it
'is true that the product Of the schools is very difficult to
measure, difficulty Of measurement should not, by itself, cause
educators to ignore the valuable function Of goal setting.

A careful identification of Objectives should be the first
step in planning and requires careful consideration. Objectives
must be identified in such a way that the ultimate success or failure
of their purpose can be determined. If an individual, or an organ-
ization, is to be expected to achieve a reasonable degree Of success
it is imperative that clear and specific Objectives be universally

understood.lo

A Conception of Organizational Management

The term "Management By Objectives" was first used by

Peter Drucker in his now classic Practice Of Management published

 

in 1954. It has since become widely recognized in the business and
industrial management literature as an identifiable managerial process.
In analyzing effective organizational management, Drucker suggested
that objectives were needed in every area where performance and results
directly affected the survival of a business. The individual manager's

job was to be directed towards achieving the Objectives of the

 

1011) id.

10

business.11 According to Drucker,

the performance that is expected of the manager must

be derived from the performance goals Of the business,
his results must be measured by the contribution they
make to the success of the enterprise. The manager
must know and understand what the business goals demand
of him in terms of performance, and his superior must
know what contribution to demand and expect of him-—
and must judge him accordingly.

He contended that a Management By Objectives (MBO) program should
emphasize teamwork, with objectives used tO identify the expected
performance Of the manager's own managerial unit, the contribution
he and his unit were expected to make in assisting other units to
attain their Objectives, and the contribution the manager might
expect from other units in the attainment of his own Objectives.
The specific Objectives Of the manager were to be both long
and short range, and would focus on tangible business Objectives as
well as the intangible objectives of managerial organization and
development, worker performance and attitudes, and public respon-
sibility. And finally, Drucker saw the measurement of performance
as a necessary means Of providing the manager with feedback infor-
mation for purposes Of self~control only. Feedback on performance
was to be used by the manager to guide his own future performance,

not by his superior as a means of control.13

 

11Peter F. Drucker, The Practice of Management (New York:
Harper and Brothers, 195a), p. 63.

 

12Ibid., p. 121.

l3lbid., pp. 121-13u.

Three years later, in an influential article published in the
Harvard Business Review, Douglas McGregor took an "uneasy look" at
the performance appraisal plans for managers then in use in large
corporations. At that time, these programs were frequently criticized
for (l) emphasizing personality traits which were subjective and
difficult to measure or change, (2) providing that ratings be deter—
mined in a unilateral fashion with the supervisor "playing God" and
judging the subordinate's personal worth as Opposed to his performance,

and (3) tending to emphasize past mistakes rather than future perfor-
mance.lu McGregor reported that managers frequently resisted admin—
istering the appraisal programs because they disliked criticizing
subordinates with whom they worked daily, lacked the interpersonal
skills necessary for successful interviewing, and mistrusted the
validity Of the trait-oriented instruments. He felt that managerial
resistance to these plans reflected the manager's unwillingness to
treat human beings as physical Objects.15
He suggested instead an approach to performance appraisal
based upon Drucker's "management by Objectives" which called for the
subordinate manager to establish short term performance goals for
himself after he had thought about his job, assessed his own strengths
and weaknesses, and formulated specific plans to meet his work goals.

The superior would then work with the subordinate, reviewing his goals

and targets.

 

ll'Douglas McGregor, "An Uneasy Look at Performance Appraisal,"
Harvard Business Review (May/June, 1957), pp. 89-95.

15mm.

12

After six months the superior and subordinate would meet again
formally to examine the subordinate's perfbrmance in terms of his
own appraisal of what had been accomplished relative to the targets
set earlier. Whenever possible, factual data would be provided to
substantiate the subordinate's claims. New goals and targets were
then set for the next six-month planning period.16

Managing by Objectives became a popular practice in the late
1950's and early 1960's when large corporations (Honeywell, General
Mills, Minnesota Mining and Manufacturing Company, to name but a few)
installed MBO programs based in part on Drucker's conceptualization
and McGregor's recommendations. These new programs generally judged
individual managers on their ability to achieve measurable goals on
perfOrmance Objectives they themselves helped to determine although
the extent of subordinate participation in the goal-setting process
varied from company to company.

A major difficulty with these programs was that they failed to
relate the manager's Objectives to the goals of the organization in a
systematic fashion. This frequently resulted in a dysfunctionality
between managerial and organizational Objectives. Another weakness
was that the programs tended to be a function of the personnel depart—
ment, rather than a tool of top management.17

In the mid—1960's, MBO came to be seen as a general system of

 

15Ibid., pp. 91-92.

l7Robert Howell, "MBO —- A Three Stage System," Business
EEEEEQQ§_(February, 1970), pp. ui-uu. '““""

13

management with an emphasis on results,18 or output in the systems
sense. MBO programs now attempted to integrate each manager's
objectives with the Objectives Of the manager above him and those

Of the organization as a whole. The focus of these programs switched
from the personnel department to the president's Office. The MBO
cycle fell in line with the budgetary and accounting cycle and
communication within the organization regarding Objectives and goals
was heightened.19 It became apparent that MBO could be an effective

means Of planning and control.20 In many large industrial or business

organizations, MBO had become an integral part Of the management process.

The major proponent of the systems approach to MBO has been

George Odiorne. His book, Management bngbjectives--A System Of

 

Managerial Leadership,21 has been widely acclaimed in the business
management and industrial relations field. Odiorne defines MBO as
a "process whereby the superior and subordinate managers of an organ—
ization jointly identify its common goals, define each individual's
major areas of responsibility in terms Of the results expected of him,

and use these measures as guides fOr Operating the unit and assessing

 

18Edward C. Schleh, Management by Results (New York: McGraw-
Hill, 1961), pp. 27-29.

 

lgHowell, "MBO - A Three Stage . . . ," p. #3.

20George Strauss, "Management by Objectives: A Critical View,"
Training and Development Journal (April, 1972), p. 10.

21George S. Odiorne, Management by_0bjectives (New York: Pitman
Publishing CO., 1965).

 

. I9.-
.

 

w
“ISLE..-

 

IN

the contributions Of each Of its members."22 Through his efforts,
and the writings Of other MBO publicists, Odiorne today claims that
a majority Of the very largest business organizations in the United
States apparently use some form of MBO.23

The MBO process itself is fairly simple. In its ideal form
it consists Of the following steps:2”

1. The identification Of the common goals of the
entire organization for a given period Of time.

2. Clarification of the organization chart in terms
Of responsibility for achievement Of the entire
organization's Objectives.

3. Establishment of specified Objectives by the
superior, usually with his subordinate's
participation:

a. Subordinate is asked to make notes on
what Objectives he will propose for the
coming period.

b. Before the meeting the superior lists
some priority Objectives for the same
period Of time.

c. Superior and subordinate meet and jointly
review proposed Objectives in detail and
reach agreement on subordinate's final
Objective. The subordinate's goals and
Objectives should complement and support
the greater goals of the organization.

 

22Ibid., p. 55.

23Odiorne, MBO Newsletter, Volume 2, NO. 8 (August, 1972),

 

p. 3.

2"'Although the steps listed are a composite of the process as
expuessed by nearly all the MBO advocates, the clearest expression of
tflue MBO process may be found in Odiorne, Management by Objectives, or
Schleh, 92.: C_J:.;c_:, pp. 3l-!+3.

 

 

n. Objectives are carefully reviewed, and a
timetable established for their accomplishment.

e. A workable system of measurement is defined
so that both superior and subordinate will be
aware of how success is to be measured.
Performance measurement should be either
qualitative or quantitative, never purely
intuitive or subjective.

f. Two copies Of the final draft Of Objective,
timetable, and measurement devices are
prepared, with superior and subordinate
each retaining a copy.

u. Superior determines with subordinate the superior's role
in assisting the subordinate accomplish his goals. The
subordinate's authority must be commensurate With his
responsibilities. He must have the necessary resources
and manpower to achieve his objectives.

5. During the year each Of the subordinate's goals is
checked as the agreed upon time period elapses. For
some Objectives the subordinate's performance may be
reviewed quarterly.
6. Success should be rewarded, usually monetarily, and
failure reviewed carefully to determine what might
be done to achieve success during the next time period.
7. New goals are established and an entire cycle starts
anew. To be truly systematic, the results of the
evaluation, and the data gathered should become inputs
in the determination Of the next period's Objectives.
Educational administrators first became aware of the possible
application of MBO for school district management in the late 1960's.
Principals, superintendents, and board members searching for more
effective means Of meeting the increasingly complex demands Of school

district administration frequently became acquainted with MBO by

attending seminars for business managers sponsored by the industrial

 

16

management divisions Of university business schools, the American
Management Association,25 and through industrial management

publications, especially the Harvard Business Review.

 

A few superintendents recognized the potential of MBO fOr school
district administrations, and with assistance from management consult—
ants and from business and the universities, began establishing their
own MBO programs. In some instances, MBO was seen as a stepping-stone
towards Program Budgeting, PERT, and other management systems.
However, the main thrust of MBO installation continues to be for
administrative evaluation.

While originally an outgrowth Of the business experience,

MBO has found increasing acceptance as a realistic alternative for
the administration Of public organizations, especially school systems.
As formal organizations, school systems and business enterprises share
some very basic characteristics: they require money, people, and a
basic idea of what is to be accomplished. As an analogy, a business
and a school system are both organizations with employees (teachers),
and boards (Of education) with identifiable goals and Objectives and
limited resources. A fundamental difference is that the overriding
central goal Of a business is the maximization Of profits (or, more

realistically, the avoidance Of loss) while the goals Of a school

 

25Unit I Of the Management Course Of the American Management

Association has emphasized standards of performance programs which

have evolved into MBO programs in many companies. See Walter R. Mahler,
"A Systems Approach to Managing by Objectives," Systems and Procedures
Journal (October, 1966), pp. 1-5.

 

 

 

 

17

system are ". . . multiple, with little guarantee of total agreement
among parents, teachers and taxpayers as to their relative importance
beyond the principal goal Of providing the highest quality Of education
with the available resources."26
What is clear is that both a business and a school system require
careful planning and an effective system of management to achieve their
respective goals with limited resources. One reason why MBO has received
such a favorable reception in business, and now in education, is because
MBO incorporates the planning function into a general system Of admin—
istration and management. MBO requires a clear statement Of organiza-
tional goals and Objectives and assigns the responsibility for achieving
those objectives to individual managers, holding them directly respon-
sible for their performance or their contribution to the overall organ-
izational effort. In today's educational terminology, MBO as a system
Of management establishes the framework whereby the school administrator
may be held accountable and be rewarded for achieving specific perform-
ance standards on identified performance Objectives for his unit Of
organizational responsibility.27
Certainly various aspects Of MBO have been employed by school
district administrators throughout the country for some time as

effective managerial practices: establishing goals, setting objectives,

performance appraisals, merit pay for administrators, etc. But as a

 

26Charles S. Benson, The Economics of Public Education
(Boston: Houghton Mifflin, 1961), p. u.

 

27John D. Kennedy, "Planning for Accountability Via Management
by Objectives," Journal Of Secondary Education, #5 (December, 1970),
pp. 348-359.

 

 

18

general system of management, MBO is only now receiving attention as
a realistic alternative for school district administration. One reason
for this is that until recently school administrators enrolled in
programs of Educational Administration were not formally exposed

to technical management skills develOped outside the field of
educational administration. A second reason is that very little

has been published regarding the use Of MBO in the public schools
beyond a few scattered articles suggesting some possible benefits

for its use or describing its Operation or process. Much of what

has been published comes from business schools and their industrial
relations and industrial management divisions.28 And as yet there is
no empirical research available investigating the dynamics of MBO

as employed in school district administration.
Significance of the Study

As accountability, cost efficiency and management system
strategies continue to expand their points Of contact and Management
By Objectives as a comprehensive management system continues to grow
in use, it is necessary to assess its specific applications in school
organizations.

The time, cost and consequences of implementing a large scale
system such as MBO are potentially so great that extreme care should
be taken to minimize factors which would deter or reduce effective

system integration as viewed by those personnel directly involved.

 

28Gerald G. Mansergh, Ed., Dynamics Of Management by Objectives
for School Administrators, Metropolitan Detroit Bureau of School
Studies, (1971).

 

 

19

Implementation and practice techniques which result in or may tend to
produce dysfunction in the system on the part of the employees of the
organization must be identified and accomodated in future applications.
Wide—scale study of the actual perceptions Of participating staff should
be extremely valuable in identifying and assessing those factors which
produce success and those which produce failure.

This study has isolated some perceived factors which affected
the outcome of a specific application Of MBO in a particular school

district.

Methods and Procedures

 

Until the time of this study, no assessment or evaluation Of
implementing or maintaining MBO in this school district had taken
place. It was timely and appropriate, therefore, to assess the impact
which this management system has had on the "exempt" administrators
still participating in it.

The data was collected through in-depth interviews with each
Of twelve original "exempt" administrators. The thirteenth was
omitted from the interview schedule since the position, Secretary to
the Board, or more recently, Executive Secretary to the Superintendent,
was unlike all other positions in that this individual reported directly
to the Board of Education and was evaluated by them. The possibility
of the influence of Board perceptions mitigated against inclusion.

This aspect Of the change process is appropriate for further study.

 

20

The writer knew each "exempt" administrator personally and
professionally. Rapport between them should have been already
established since he had worked closely with them in a variety of
circumstances and relationships toward mutual goals.

The approval Of the Superintendent and the Board Of Education
was secured to pursue such a study among the administrative staff.

Over a period Of two weeks, two-hour interviews were scheduled with

each Of them. A brief, uniform explanation concerning the general
nature of the research and how it related to the interview was provided.
The "process" Of MBO was stressed in an attempt to minimize the possible
conclusion that their commitment to and involvement in it was being
"evaluated". For this reason, the framework Of the explanation and

the questions asked centered on the "organization" realizing, Of course,
that answers were personally oriented, individually revealing and subject
to an evaluative interpretation. In addition, it was made very clear
that all responses would be unidentifiable by source and that the
results would be a synthesis of the accumulated responses. Beyond

that, the writer was prepared to place considerable confidence in
rapport, previously established.

Their judgements, evaluations, perceptions as to degree, quality,
and usefulness, and also the extent to which they appeared or indicated
to have internalized the process, was sought and recorded during the
questioning.

The method Of questioning may be considered unstructured, although
the format fOllowed the "funnel" approach. That is, the questions

gradually became more specific as the responses became more specific.

 

 

 

21

The sequence of questions followed was similar to these:

1. Please explain, in your own words, the process
Of management by Objectives, as currently practiced.

2. In general, how do you feel about this process?
3. How do other "exempt" administrators feel about it?
u. Has this been your point of view from its inception?

5. What has happened along the way to change your mind
or substantiate your View?

6. DO you feel it is an effective management process?
Why or why not?

7. How should or could it be modified to better suit
the needs of the organization and the administrators?

The analysis Of the data collected through these interviews was
used to answer the following study questions:

1. TO what extent do involved administrators feel the
original purposes of MBO have been met?

2. What are their preceptions of this system at the
present time?

3. Based on the beliefs of the "exempt" administrators,
where does their activity in the MBO process differ
from the stated structure in organizational policy?

A. How, and to what extent do they believe the MBO
system has been modified since it was begun?

5. DO they believe it is presently more effective

or less effective than it was originally? Why do
they believe that?

Terminology

 

Terms unique to this particular study or the field of education,
while few, are indicated here for purposes of clarification or to

distinguish them from commonly understood and accepted definitions:

 

..

l“ ....—

__.._.—

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.v-U

‘ ‘

..

 

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22

West and CO., Inc.--A fictitious name given to a private management
consultant firm based in Chicago, Illinois, employed by the Eastwood
Public Schools Board of Education.

Eastwood Public Schools.-—A fictitious name applied to the school
district involved in the study, located in a large metropolitan area.

 

Exempt Administrator.--The name applied to all administrators in the
Eastwood Schools who are not affiliated with a collective bargaining
group. They include the Superintendent, the Associate Superintendents,
the various Directors Of Education and all of the administrators in
the Personnel and Labor Relations Division.

 

Management By Objectives.--The working definition applied to this process
by West and Company, is "the total process Of developing Objectives and
establishing and implementing action to achieve managerial goals."

Odiorne, on the other hand, uses the more classic and accepted
statement:

"A process whereby the superior and subordinate
managers Of an organization jointly identify its
common goals, define each individual's major
areas of responsibility in terms Of the results
expected Of him, and use these measures as guides
for Operating and assessing the contributions Of
each of its members."29

Delimitations

 

The Operational scope of this study is restricted to a single
large metropolitan area school district which initiated and sustained
a system of administration called Management By Objectives.

The population included in the study are all Of the "exempt"
administrators who were employed by the district from the time the

MBO program was installed tO the time Of the study.

 

29Odiorne, Management by Objectives, Op. Cit.

 

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Liza-..-.

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bvvvfi .VB

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23

The data consists Of the elicited perceptions and Opinions
recorded as responses to a structured set Of questions in an interview

environment on the work site Of the involved administrators.

 

. "
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CHAPTER I I
REVIEW OF THE LITERATURE
Management By_Objectives Concept

Much of the literature focuses upon the mechanics or tech-
niques of making the system work as Opposed to viewing management
by Objectives as a philosophy Of management based upon an under-
standing Of human nature. It is clear from the literature that
a manager can follow all of the correct steps, apply all of the
techniques correctly, and still see his efforts result in failure.

A complete overview Of management by Objectives was provided
in a 1970 issue of The Economist. The article reviewed the work done
in England by consultants John Humble and Urwick Orr and described

the MBO process as it has worked in a specific company, including the

following statement:

Installing MBO can Often be a traumatic experience
for a company, especially for top managers. Hidden
prOblems and conflicts will be brought into the Open.
Management consultants are highly valuable to shepherd
the company through this period, quite apart from the
previous experience of MBO they can Offer. Eventually
each manager ends up with his key results areas iden-
tified and written down and his Objectives agreed upon.
From then on, this part is comparatively routine. But
there is more. First, he and his boss must draw up a
job improvement plan for him and decide how to go about
it. Secondly, MBO at top management levels inevitably
forces tOp managers to start asking themselves

24

25

fundamental questions ibout what the company is doing
and where it is going.

Thus, MBO is not only a decision—making technique. It is also
based on the human aspect of the management process, improving the
performance of the individual manager as a human being, operating in
a web of human relationships with fellow managers.

The term management by Objectives first appeared in the liter-
ature as a way of building teamwork and common effort. Drucker pointed
out that each member of an enterprise contributes something different
but all must contribute toward a common goal. He stated:

Their efforts must all pull in the same
direction, and their contributions must fit to-
gether to produce a whole--without gaps, without
friction, without unnecessary duplication Of effort.

Business performance therefore requires that
each job be directed toward the objectives of the
whole business. And in particular, each manager's
job must be focused on the success Of the whole.

The performance that is expected Of the manager must
be derived from the performance goals Of the business,
his results must be measured by the contribution they
make to the success Of the enterprise. The manager
must know and understand what the business goals
demand of him in terms of performance, and his
superior must know what contribution to demand and
expect of him . . . and must judge him accordingly.
If these requirements are not met, managers are
misdirected. Their efforts are wasted. Instead

Of teamwogk, there is friction, frustration, and
conflict.

 

1Stephen J. Carroll, Jr., and Henry L. Tosi, "What is
Management by Objectives?" The Economist, CCXXXV, NO. 6609,
(April 25, 1970), p. 60.

 

2Peter Drucker, The Practice Of Management, New York:
Harper and Row, 1959), p. 121.

 

Ar.

I
ny.“oAf“\
\ v)\
“...... v

 

(I)

tw-

"“v.,

e .
u '- I.
‘nv “
‘no -
. . .

Drucker continued and made an important point about the
business enterprise that is quite descriptive Of the public education
enterprise. He said:

Management by Objectives requires major effOrt and
special instruments. For in the business enterprise,
managers are not automatically directed toward a common
goal. On the contrary, business, by its very nature,
contains three powerful factors Of misdirection: in the
specialized work Of most managers; in the hierarchical
structure Of management; and in the difference in
vision and work and the resultant insulation of various
levels Of management.3

MBO does not work simply because Objectives are set and
performance is measured against those Objectives; this could be
done in a highly autocratic organization. Mali Offered a concise
explanation Of why management by Objectives works when he stated:

Economic life without productive work directed
toward some purpose is meaningless, dull and sterile.
It is within the nature Of man to engage in purposeful
activity. It provides him with satisfaction, especially
when directed toward a common good. This common good may
be manifested as perpetuation of the enterprise, customer
satisfaction, or employee security. Purposeful activity
that follows a course of action to some end is compatible
with man's deep urge for growth, development and life.
This is motivational! Managing by Objectives follows
man's inherent progressive principle Of changing disorder
to order, unfinished to finished, disorganization to ‘
organization. Man's purpose, in other words, finds
expression in reaching and achieving higher levels Of
good. The work situation becomes an Opportunity fOr
him to exercise this process. What makes MBO work is
that it fills man's deep desire to accomplish; MBO
gives him the Opportunity and the process to select
what is to be accomplished, how it is to be accomplished,
and when.

 

31bid., p. 122.

. . .
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27

Achievement for man in the work situation must not
be a mere possibility but rather a certainty if
economic life ifi to be meaningful, stimulating,
and fulfilling.

Underlying_Principles

Reliance on inherent authority of position, as a management
system, is doomed tO failure. Authority is no longer absolute but,
rather, is relative. McGregor pointed out that the effectiveness Of
authority as a means of control depends upon the ability to enforce
it through the use Of some form Of punishment.5

He used as examples the military, wherein authority is
enforceable through the court-martial with the death penalty at the
extreme end; and the church, wherein excommunication represents the
psychological equivalent of the death penalty.

At one time management could enforce its authority with threat
Of unemployment. However, the myriad Of social legislation which began
in the 1930's and continues today, has lessened the impact and likelihood,
in many instances, Of capricious discharge. The result is less dependence
by the employee in the employment relationship.

The role of the manager varies. In one instance he is in
the role of superior; in another instance he is a subordinate;
and still at other times he must function successfully as a co-equal

with other managers.

 

”Paul Mali, Managing by Objectives, (New York: John Wiley
and Sons, 1972), p. 16

 

5Douglas McGregor, The Human Side Of Enterprise, (New York:
McGraw-Hill, 1960), p. 21.

 

28

In deciding how best to manage others, it is necessary to
consider those factors known to motivate man. It is possible to arrange
man's needs on a hierarchical basis, with the higher needs emerging as
the more basic ones are satisfied. Maslow arranged these needs as
follows:

1. Physiological Needs.--When physiological needs

are unsatisfied, all needs Of a higher order may

become non-existent or will at least be relegated
into the background . . . .

 

2. Safety Needs.--Subsequent to the fulfillment Of
physiological demands, there arises a need for
safety from destructive forces, threats Of injury
and disruptions of satisfying routines . . . .

 

3. Love Needs.--When both physiological and safety
needs are adequately cared for, there emerges a
longing for love and affection, for closeness,
and a feeling of belonging . . . .

 

n. The Need for Esteem.--A still higher order of
need is that for the esteem Of others and for a
sense of self-respect and personal adequacy . . .

 

5. The Self-Actualizing Need.--The need to realize
fully his self-potential has been suggested as
man's highest goal.6

 

Of prOfOund significance, according to McGregor, is the
fact that a satisfied need is not a motivator of behavior. It is
commonly ignored in the conventional approach to the management of
people. In discussing man's needs, McGregor made the following
point:

Management knows today Of the existence Of these
needs (love or social needs), but it is Often assumed
quite wrongly that they represent a threat to the organ-

ization. Many studies have demonstrated that the tightly
knit, cohesive work group may, under proper conditions,

 

6A. H. Maslow, "Theory Of Human Motivation", Psychological
Review, L. (1993), pp. 370-396.

 

29

be far more effective than an equal number of
separate individuals in achieving organizational
goals. Yet, management, fearing group hostility to
its own Objectives, Often goes to considerable
lengths to control and direct human efforts in ways
that are inimical to the natural "groupingness"

Of human beings. When man's social needs--and
perhaps his safety needs, too--are thus thwarted,
he behaves in ways which tend to defeat organ-
izational Objectives. He becomes resistant,
antagonistic, uncooperative. But this behavior

is a consequence, not a cause.

Of greatest significance to management are what McGregor
called the egoistic needs. These are what Maslow called the need
for esteem. McGregor classified these needs into two kinds, as
follows:

1. Those that relate to one's self-esteem: needs

for self-respect and self-confidence, fOr autonomy,
fOr achievement, for competence, and for knowledge.

2. Those that relate to one's reputation: needs

for status, for recognition, for appreciation,

for the deserved respect of one's fellows.
Unlike the lower needs, the egoistic needs are rarely satisfied
according to McGregor. There are very limited opportunities for
the satisfaction of these for persons in the lower levels of the
hierarchy in most organizations.

In discussing the highest level Of need, that Of self-
actualization or self-fulfillment--the needs fOr realizing one's

own potentialities, for continued self-development, for being

creative in the broadest sense Of that term-—McGregor pointed out

 

7McGregor, Op. Cit., pp. 37-38.

8Ibid., p. 38.

30

that the conditions of modern industrial life give only
limited Opportunity for those relatively dormant human needs
to find expression.

McGregor made the following points with reference to
motivation:

We recognize readily enough that a man
suffering from a severe dietary deficiency is
sick. The deprivation Of physiological needs
had behavioral consequences. The same is true,
although less well recognized, Of the deprivation
Of higher—level needs.

The man whose needs for safety, association,
independence, or status are thwarted is sick just
as surely as is he who has rickets. And his sick-
ness will have behavioral consequences. We will
be mistaken if we attribute his resultant passivity,
or his hostility, or his refusal to accept respon-
sibility to his inherent "human nature". These
forms Of behavior are symptoms of illness—-Of
deprivation Of his social and egoistic needs.

The man whose lower-level needs are satisfied
is not motivated to satisfy those needs. For
practical purposes they exist no longer . . . .
Management Often asks, "Why aren't people more
productive? We pay good wages, provide good
working conditions, have excellent fringe
benefits and steady employment. Yet people do
not seem willing to put forth more than minimum
effOrt." It is unnecessary to look far for the
reasons.

Consideration Of the rewards typically
provided the worker for satisfying his needs through
his employment leads to the interesting conclusion
that most of these rewards can be used for satisfying
his needs onlypwhen he leaves the job. The only
contribution they can make to his satisfaction on
the job is in terms Of status differences resulting
from wage differentials.

 

Most fringe benefits--overtime pay, shift
differentials, vacations, health and medical
benefits, annuities, and the proceeds from stock

31

purchase plans or profit—sharing p1ans--yield

needed satisfaction only when the individual

leaves the job. Yet these, along with wages,

are among the major rewards provided by

management for effort. It is not surprising,

therefore, that fOr many wage earners work is

perceived as a form Ofppunishment which is the

price to be paid for various kinds Of satisfaction

away from the job. To the extent that this is

their perception, we would hardly expect them

to undergo more of this punishment than is

necessary.

In today's world, management has provided reasonably well
for the physiological and safety needs Of the work force. The
result has been a shift in the motivational emphasis to the social
and egoistic needs. In the absence Of opportunity to satisfy these
needs at work, the worker will be deprived and his behavior will
reflect this deprivation. McGregor stated that under this
condition "if management continues to focus its attention on
physiological needs, the mere provision Of rewards is bound to
be ineffective, and reliance on the threat of punishment will be
inevitable."lo

In 1960 McGregor developed what is known as Theory X and
Theory Y. Theory X and Theory Y are not managerial strategies;
they are underlying beliefs about the nature Of man. Theory X,
the traditional view Of direction and control, views the human being

as follows:

1. The average human being has an inherent dislike
Of work and will avoid it if he can.

 

91bid., pp. sa-uo.

loIbid., pp. uo-ul.

32

Because of this human characteristic

of dislike of work, most people must be
coerced, controlled, directed, threatened
with punishment to get them to put forth
adequate effort toward the achievement of
organizational Objectives.

The average human being prefers to be
directed, wishes to avoid responsibility,
has relatively little ambition, and wants
security above all.

It was McGregor's belief that the principles Of organization which

comprise the bulk Of the literature of management could only have

been derived from assumptions such as those of Theory X.

Theory Y, a concept Of the integration of individual

and organizational goals, views the human being as follows:

1.

The expenditure of physical and mental effort

in work is as natural as play or rest. The
average human being does not inherently

dislike work. Depending upon controllable
conditions, work may be a source of satisfaction
(and will be voluntarily performed) or a source
of punishment (and will be avoided if possible).

External control and the threat Of_punishment
are not the only means of bringing about efforts
organizational objectives. Man will exercise
self-directiOn and self-control in the service
Of Objectives to which he is committed.

Commitment to Objectives is a function of the
rewards associated with their achievement.

The most significant Of such rewards, e.g.,

the satisfaction Of ego and self-actualization
needs, can be direct products Of effOrts directed
toward organizational Objectives.

The average human being learns under prgper
conditions, not only to accept but to seek

 

11

Ibid. , pp. 33-3”.

33

responsibility. Avoidance Of responsibility,
lack Of ambition, and emphasis on security
are generally consequences Of experience, not
inherent human characteristics.

 

5. The capacity to exercise a relativelyAhigh degree
of imagination, ingenuity, and creativity in the
solution Of organizationalgproblems is widely
not narrowly, distributed in the pppulation.

 

 

 

 

"These assumptions involve sharply different implications
for managerial strategy than do those Of Theory X. They are
dynamic rather than static. They indicate the possibility
Of human growth and development; they stress the necessity
for selective adaptation rather than a single absolute form
of control. They are not framed in terms of the least
common denominator of the factory hand, but in tisms Of
a resource that has substantial potentialities."

Management's task under Theory X, according to McGregor, is
described as follows:

"1. Management is responsible for organizing the
elements of productive enterprise——money,
materials, equipment, people—-in the interest
of economic ends.

2. With respect to people, this is a process Of
directing their efforts, motivating them, controlling
their actions, modifying their behavior to fit the
needs Of the organization.

3. Without this active intervention by management,
people would be passive--even resistant-~to
organizational needs. They must therefore
be persuaded, rewarded, punished, controlled--
their activities must be directed. This is
management's task—-in managing subordinate managers
or workers. We Often sum it up by saying that
management consists of getting things done through
other people."13

 

lQIbid., pp. u7—u8.

13Douglas McGregor, Leadership and Motivation, (Cambridge,
Massachusetts: M.I.T. Press, 1966), p. 6.

 

su

McGregor described the concept Of management's role under Theory Y

as follows :

"1. Management is responsible for organizing the
elements Of productive enterprise--money,
materials, equipment, people—-in the interest
Of economic ends.

2. People are not by nature passive or resistant
to organizational needs. They have become so
as a result of experience in organizations.

3. The motivation, the potential for development,
the capacity for assuming responsibility, the
readiness to direct behavior toward organizational
goals are all present in people. Management does
not put them there. It is a responsibility Of
management to make it possible for people to
recognize and develop these human characteristics
fOr themselves.

u. The essential task of management is to arrange
organizational conditions and methods Of Operation
so that people can achieve their own goals best
by directing their own effOrts toward organizational
Objectives. This is a process primarily of creating
Opportunities, releasing potential, removing Obstacles,
encouraging growth, providing guidance. It is what
Peter Drucker has called 'management by objectives'
in contrast to 'management by control'."1u

According to McGregor,

"acceptance of Theory Y does not imply abdication,

or 'soft' management, or 'permissiveness'. As was indicated—-
such notions stem from the acceptance of authority as the

sin le means Of management control, and from attempts to
m1nimize the negative consequences. Theory Y assumes that
people will exercise self-direction and self-control in the
achievement Of organizational Objectives to the degree that
they are committed to those Objectives.

 

"If that commitment is small, only a slight degree of
self-direction and self—control will be likely, and a
substantial amount of external influence will be necessary.

 

1”Ibid., pp. 15—15.

35

If it is large, many conventional external controls
will be relatively superfluous, and to some extent
self—defeating. Managerial policies and pracigces
materially affect this degree Of commitment."

McGregorl6 cautioned that authority is not an appropriate
means for Obtaining commitment to Objectives. Integration of the
individual's goals with those of the organization is an important
concept inherent in Theory Y. In order for the organization to
become more effective in achieving its Objectives, adjustments must
be made in significant ways to the needs Of its members. This
requires that both the organization's and the individual's needs be
recognized. Although, it must be kept in mind that the perfect
organization is not possible to achieve and neither is perfect
integration of organization and individual needs a possibility.
McGregor stated:

"perfect integration Of organization requirements
and individual goals and needs is, of course, not a
realistic Objective. In adopting this principle (of
integration), we seek that degree Of integration in
which the individual can achieve his goals best by
directing his efforts toward the success of the
organization. 'Best' means that this alternative
will be more attractive than the many others avail-
able tO him: indifference, irresponsibility, minimal
compliance, hostility, sabotage. It means that he will
continuously be encouraged to develop and utilize
voluntarily his capacities, his knowledge, his skill,
his ingenuity in ways which contribute to the success
of the enterprise." 7

 

lsMcGregor, The Human Side of Enterprise, Op; Cit., p. 56.

 

16Ibid.

17Ibid., p. 55.

36

The Element Of Participation

Inherent in Theory Y is the concept Of participation. The idea
Of employee participation is frightening to some managers, used as a
manipulative tool by others, and is generally thought by most to apply

to groups, not to individuals. According to McGregor,
". . . the effective use Of participation is a consequence
Of a management point of view which includes confidence in
the potentialities Of subordinates, awareness of management's
dependency downwards, and a desire to avoid some of the
negative consequences of emphasis on personal authority.
It is consistent with Theory Y-—with management by integration
and self-control. It consists basically in creating Oppor-
tunities under suitable conditions for people to influence
decisions affecting them. That influence can vary from a
little to a lot."1

McGregor placed employee participation in management in clear perspective

when he said:

"It is perhaps most useful to consider participation
in terms of a range Of managerial actions. At one end of
the range the exercise of authority is relatively small
and participation is maximum. There is no implication
that more participation is better than less. The degree
of participation which will be suitable depends upon a
variety of factors, including the problem Of issue, the
attitudes and past experience of the subordinates, the
manager's skill, and the point Of view alluded to above.”19

All significant management activities contain the element Of
risk, and participation is no exception. A common fear on the part
Of managers is that if employees are given an opportunity to partici-
pate in and thereby influence decisions which affect them, they will
soon want to participate in matters which are none Of their concern.

Managers who voice this fear tend to have a narrow conception Of the

 

18Ibid., pp. 125-126.

191bid., p. 126.

37

issues which should concern employees. McGregor stated:

"If management's concern is with the growth of employees
and their increasing ability to undertake responsibility, there
will of course be an expectation that employees will become
involved in an increasing range Of decision-making activities.

"Participation which grows out of the assumptions of
Theory Y Offers substantial Opportunities for ego satisfaction
for the subordinate and thus can affect motivation toward
organizational Objectives. It is an aid to achieving
integration. In the first place, the subordinate can
discover the satisfaction that comes from tackling problems
and finding successful solutions for them. This is by no
means a minor form Of satisfaction." 0

It must be borne in mind constantly that participation must be used
judiciously and with understanding. It is by no means a panacea, a

manipulative device, a gimmick, or a threat. It is entirely consistent

with management by integration and self-control.

Implementation Outcomes

There has been little scientific and empirical research done
with regard to the outcomes Of management by Objectives. Almost all
Of the literature is based on the experience Of consultants working
with many companies in instituting MBO and/or troubleshooting ailing
MBO programs. Ivancevich21 questioned whether or not MBO has been
able to accomplish the planning, controlling, and motivational
Objectives claimed by its advocates. He cited some empirical

studies which have been made. Meyer, Kay, and French, in 1965,

 

2OIbid., pp. 130-131.

21John M. Ivancevich, "A Longitudinal Assessment of Management
by Objectives", Administrative Science Quarterly, XVII, NO. 1 (March,
1972). pp. 126-135.

38

used a control group and an experimental group in an attempt to measure
the outcomes Of an MBO program. The control group Operated under the
traditional perfOrmance appraisal system while the experimental group
was encouraged to develop goals for achieving improved job perfOrmance.
Over a one-year period those in the experimental group had more favor-
able attitudes toward the content and challenge Of their jobs than did
those in the control group.22

Raia, in 1965 and 1966, made a study based on longitudinal data
compiled at Purex Corporation, Ltd. The study initially showed that
the MBO program resulted in significant improvement by the participants
toward their jobs. A follow-up Of the initial study fourteen months
later showed that the MBO program had deteriorated as an effective
motivational mechanism and that a number Of obstacles had arisen,
including the fOllowing:

l. Lower-level managers felt they were not fully partici-
pating in the setting Of Objectives.

2. The burden of paperwork had become excessive.

3. TOO much emphasis was placed on quantitative
measures.

6. The use Of MBO as a device to generate extra work
from managers.

Tosi and Carroll, in 1968 and 1970, attempted to correlate
characteristics Of Objectives in an MBO program with manager person-

ality characteristics. The results showed that a clear statement of

 

221bid., p. 126.

23Ibid., p. 126.

39

Objectives was related to higher levels of satisfaction with the superior
and to the belief on the part of the subordinate that the MBO program
was important.2u

In 1970, Ivancevich, Donnelly, and Lyon examined the importance
Of implementing MBO in two companies on the manager's sense of job
satisfaction. In the first company the personnel manager conducted
the training and handled the implementation of MBO. In the second
company, top-level executives performed the training and implementation
activities.25 The results showed that where administration handled
the program a marked improvement in perceived need satisfaction among
managers took place. How long the improvement lasted was not measured.
HOwever, in the first company MBO had not filtered down to the first-
level managers, and job satisfaction was not significantly improved.
In the second company there was an initial improvement in self-
actualization and security categories for lower-level managers,
but this did not last. In the first company the personnel depart-
ment, given the task Of training and implementation, had a very poor
reputation within the company. In the second company, where improved
job satisfaction did not last, there was a lack of sustained effort
by top management to continued commitment. After the initial training,
less time and commitment were accorded MBO. Concepts learned in
training were not supported by top—management actions in actual practice.

In both companies the executive decision-making groups specified who

 

2”Ibid., p. 126.

251bid., p. 127.

90

would be trained and, more important, suggested how much time trainees
could be away from their jobs. In both companies nO specific managerial
activity was undertaken after the training sessions which would have
reinforced the content and processes of training——goal setting became
almost totally boss-oriented.

Ivancevich referred to MBO as a training technique in his
article and indicated that other companies had used it as a manpower
planning technique, compensation benchmark, or as an overall managerial
performance assessment mechanism. Many writers on the subject Of manage-
ment by Objectives tend to view it as a mechanism or personnel tool as
Opposed to a total philosophy Of management with benefits tO be derived
by both employee and employer.26

Mali cited fOur basic principles from which Operating principles
for MBO emerge. These were the following:

1. Unity Of managerial action is more likely to occur when
there is pursuit Of a common Objective.

2. The greater the focus and concentration on results one
wants to achieve on a time scale, the greater likelihood
of achieving them.

3. The greater the participation in setting meaningful work
with an accountability for a result, the greater
motivation for completing it.

4. Progress can only be measured in terms of what one is
trying to make progress toward.27

In many ways the concept of managing by Objectives is inseparable
B

from other management essentials. Delegation of authority, division Of

 

26Drucker, QpL_Cit.

27Ma1i, 9p_._ Cit., p. 3.

91

labor, decision making, performance appraisals, and policy making
are a few examples Of management essentials that become involved in
the concept. However, as Mali pointed out, "the management essential

that has been its historical taproot is coordinated decentralization".28

Mali described the concept Of MBO as it operates in the
Honeywell Corporation. When Honeywell decided to make managing by
Objectives a corporation-wide philOSOphy for all its profit centers,
it brought greater precision Of thinking, planning, activating,
coordinating, and controlling to its managers. The concept gave them
a sense of focus and concentration. They experienced managing by
Objectives as a total approach to the task Of management. They did
not regard the concepts as a prOgram, a staff activity, or a panacea
for an immediate problem; rather, it was the heart and core Of managing
the organization.29

The job Of managing at Honeywell previous to the adoption Of
MBO was described as unpredictable, as almost a game of chance. The
conditions prevailing at that time were described as follows:

Less than a decade ago, neither decentralization

nor management by Objectives was prevalent at Honeywell.

The company prided itself on its use Of an informal manage-

ment style. Although it had grown from $29 million in sales

in 1941 to $u7o million in 1961, it preferred to operate

like a relatively small company. Management Of the company

rested personally in the hands of the chairman, Harold B. Sweatt,
and a small group Of close associates. They made most of the

 

2BIbid.

2glbid., p. 5.

H2

important decisions and a great many minor ones.30

According to one experienced manager at Honeywell, there are
two important mp§£§_if either decentralization or management by
Objectives is to be of value:

1. The company must really mean to use them-~otherwise
don't bother to try to teach them.

2. The company must build them into the management
system--ogperwise no manager can really learn to
use them.

Mali explained the experience of the 3M Company with management
by Objectives. The 3M Company noted the strong tendency in its
operation to assume that the important goals Of a unit were well-
known and understood. The degree to which this is or is not true
Often makes the difference between mediocre and outstanding accomplish-
ments. By using the approach Of managing by Objectives at all levels
Of supervision, a clarity was brought about in the mission and results
Of the units. The 3M Company personnel noted that the MBO way of
managing tended to eliminate the "political" atmosphere; that is,
the need to try to guess what the boss wanted and how far to go to
please him no matter what he seemed to want. In this company MBO
also eliminated the confusion in directions that formerly ensued

when there was a turnover in management at the higher levels.32

 

30Conference Board, Managing by and with Objectives, Study
NO. 212, (New York: Conference Board, 1968), p. 21.

 

311616., p. 26.

32Mali, Op. Cit., p. 5.

us

Maintenance Implications

 

A fundamental prerequisite for MBO to work is top leadership
commitment to the system as a total management philosophy. That
commitment must be exhibited in performance and hard work. Some
may believe that the system works well enough in private enterprise
but cannot be used successfully in a non-profit institution such as
a public school system. Olsson spoke directly to this point when he
said:

One Of the biggest deterrents to the individual's
accepting and using any general principle or concept is
his feeling that his is a unique situation. Managers
are no exception. They are Often hesitant, sometimes
even obstinate, about applying a new management concept
to an Old situation. Even though the concept has been
proved valid, the manager may say, "Yes, but that's
a different kind of business. They don't have nearly
the number Of prOblems we have."

The manager is forgetting that even though organ-
izations do differ in degree and kind, they are funda-
mentally the same. Some organizations may inherently
have more "problems" than others, but this does not
mean the same principles or concepts Of sound management
cannot be applied successfully to solve these problems.

All enterprises are similar in that they require
people, money, and a basic idea of what is to be accom-

plished. Because of this essential similarity, managemen
by Objectives can be applied to any type Of organization.

The failure of many organizations to understand fully and to
view management by Objectives as a total concept or philosophy of
management and to recognize that a total commitment to its underlying

philosophy is required in order to implement it successfully has

 

33David E. Olsson, Management by_Objectives, (Palo Alto,
California: Pacific Books, 1968), Pp. 10-11.

 

nu

resulted in failure. The failure, however, is not in MBO; it is

the result Of ineffective management. Molander stated the case this
way:

In practice many organizations have lost sight of, or
have difficulty in implementing, the basic philosophy which
underpins the techniques of MBO--as a result, there are
wide differences in Opinion concerning its effectiveness.
In some cases failure is almost certainly due to a manage—
ment's attempt to use MBO as a method Of sustaining or
reinforcing an existing managerial ideology totally at
variance with that which prompted Drucker to introduce
the concept .

Molander further proposed two main reasons for the failure Of
MBO to produce the expected results:

First, that the managerial ideology is ill-suited to,

or at variance with, the underlying philosophy Of MBO

and secondly, the system is installed with little regard
for the lessons of the behavioral sciences, so that Often
commitment to the task amongst managers falls rather

than rises, and instead Of there being an increase in
cooperation amongst managerial groups, there is Often

an incregge in the level and degree Of organization
tension.

Molander described his experience with one firm where he served
as a consultant. The firm had claimed to have satisfactorily intro-
duced MBO. Molander found that each manager had received a Key Results
Form with forty to 120 targets. There had been no prior consultant used
to arrive at the targets and no procedure established for review as
contemplated. "In effect the key results were simply a jOb specifi-
cation outlining roles in great detail (including the case of a fore—

man, 'reducing unavoidable labour turnover by fifteen percent')."36

 

3”C. F. Molander, "Management by Objectives in Perspective",

Journal of Management Studies, IX, NO. 1 (February, 1972), pp. 79-75.

3

35Ibid., p. 76. 6Ibid., p. 76.

#5

Upon investigation, Molander discovered that few in lower
level management were aware that MBO had been introduced and could
not state even the major components of the Key Results Form and
could not find the fOrm. "It seemed in this particular case (that)
MBO was in reality a bureaucratic defense mechanism fOr senior
management, a potentially effective controlling device to avoid
overlapping responsibilities and apportion blame fOr shortcomings
more readily."37 Molander agreed that there may be instances where
such a purpose is functional, but it could reduce commitment where
it had previously existed. "In this case MBO was used as a stick
with which to beat management. Put another way, when a basically
collaborative technique is used to bolster an authoritarian manager—
ial structure, it is small wonder that cooperation and commitment
do not increase."38

An organization contemplating introduction Of the concept
of MBO must make an honest and total commitment to its underlying
philosophy and concepts or the result will be failure, with a likely
decrease in managerial commitment.

An organization which has an authoritarian concept Of manage—
ment must change attitudes to the extent that there is no further
reliance on such techniques of managing. To quote Molander:

"where this technique (MBO) is used within what remains

an authoritarian structure, the boss—subordinate relation-

ship is indeed Often the focus for win-lose struggles.

Common amongst the vast range Of plays Open to the

subordinate is that referred to by Bryan as 'suboptimization'
by which he means the achievement by the subordinate Of

 

37Ibid., p. 76. 381bid., p. 76.

#6

personal goals at the expense Of organizational Objectives.

Bryan maintains suboptimization Operates in two main forms:

one in which the manager deliberately selects goals which

he knows he can achieve, which are simple rather than

complex and are readily quantifiable, and the other in

which the manager strives to avoid high risk programmes

in favour Of keeping the system going."

In a Theory X environment, MBO is very susceptible to
becoming a useful technique for reinfOrcing an already existing set
Of authoritarian values.

A manager's beliefs about the nature of man and his commitment
to MBO as a total philosophy or concept Of management as opposed to
a personnel technique or other mechanism for an isolated management
function is Of great importance--more important than the mechanical
techniques used in administering MBO. Perko, writing in the CASBO
Journal Of School Business Manegement, made this point by stating:
"The most important costly resource in any educational organization

is people. People make 'systems go'."”0 There are many ways to make

managing by Objectives fail. McConkey, writing in Management Review,

 

compiled a list of twenty ways to kill management by Objectives.”1
The list was compiled from his experience with over 300 diverse
businesses and dramatizes how oversight, neglect, and lack of under-

standing in twenty major areas by those companies' managers largely

 

391bid., p. 77.

”OJOhn E. Perko, "The Human Side of Management-—People Make
'Systems GO'", CASBO Journal of School Business Management, XXXVIII,
NO. 2 (November, 1972), p. 17.

ulDale D. McConkey, "20 Ways to Kill Management by Objectives",
Management Review, LXI, NO. 10 (October, 1972), pp. 4—13.

’47

accounted for the difference between a healthy and an ailing MBO
program. It was McConkey's belief that the problems encountered
with MBO were not the fault Of weaknesses in the MBO system itself,
but were caused by the weaknesses Of the managers who had applied
the programs. He suggested the fOllowing uses for the list:
To managers considering adoption of an MBO program,

the list may be helpful in planning, for companies that

have already embraced MBO and have experienced only

limited success, it should serve as a debugging check—

list. For still other organizations that latched onto

a handy guide to killing the program much more rapidly

so that they can proceed, without tOO much delay, to

picking another pig in a poke. 2

The list contained the following items: (1) consider MBO
a panacea, (2) tell them their Objectives, (3) leave out staff
managers, (9) delegate executive direction, (5) create a paper
mill, (6) ignore feedback, (7) emphasize the techniques, (8) imple-
ment overnight, (9) fail to reward, (10) have Objectives but no
plan, (11) stick with original program, (12) be impatient, (13) quan-
tify everything, (19) stress Objectives, not the system, (15) drama-
tize short-term Objectives, (16) omit periodic reviews, (17) omit

refresher training, (18) do not blend Objectives, (19) be gutless,

and (20) refuse to delegate.”3

Implementation Guidelines
In order to implement MBO successfully, the support of the
top man in the organization is required. Odiorne described the

conditions necessary to install the system successfully as follows:

 

”Ibid., p. 1+. ”31616., pp. 4-13.

H8

The primary condition that must be met . . . . is the
support, endorsement, or permission Of the principal manager
in the organizational unit where the system is to be used.
The premise that success for the subordinate means "helping
the boss to succeed" means also that the boss must be in
accord with the goals Of the subordinate and must not Oppose
the methods he used to achieve them.

The foregoing does not necessarily preclude any manager whose
boss is not Opposed to his using the system from going ahead on his
own and installing M80 in his own unit, so long as he has discretionary
power over the methods Of management. In the public schools, the
Superintendent should have the strong support Of the Board of Education,
but in the absence Of such strong support he can still successfully
introduce the system provided the Board does not Object.

Brown suggested six prerequisites for successfully implementing
management by objectives. They are summarized below:

1. A management development plan, or, in-service training.

2. The necessity to clarify the Objectives and structure of
the organization.

3. The necessity to devise an organizational chart and job
specifications.

u. The necessity to set clearly understood targets against
which a manager is to be assessed.

5. The wholehearted belief and support of top management
and the participation Of all levels of management. Both
require the commitment of all managers to the policy in
addition to the support Of top management. In both cases,
managers must see that the system is helping them to help
themselves, to harmonize the pursuit Of individuals with
the pursuit Of organizational goals.

 

1”George S. Odiorne, Management by Objectives: A System Of
Managerial Leadership, (New York: Pitman, 1965), p. 68.

 

 

U9

6. There must be a company climate in which planned
use Of resources and the systematic analysis Of
problems is combined with an Obviously sincere
desire tO understand human problems at all levels.us

Humble listed five keys for achieving success in implementing
and maintaining an MBO system, as follows:

1. Determined and committed leadership from the tOp.

2. Flexibility in method and technique.

3. MBO as an undelegatable executive responsibility;
but the need for a high quality advisor at launching
stage.

n. An organic view Of the need to change, develop and
improve M80.

5. Maintaining momentum. As Brian Viner says, "Even
where this concept Of management has been completely
built into the business and apparently accepted, it
does need constant lefigership to ensure that it is
kept up to the mark."

Participation is a mandatory and key factor in the implemen—
tation and administration Of an MBO system, as illustrated by Brown
in the statement:

"MBO is based on the participation of all managers in
the setting Of targets and standards. It seeks through
rigorous analysis to build upon the strengths and minimize
the weaknesses Of individuals as members Of the organization.
This approach applies to individual and to business situations.
It concentrates on the key factors which influence profit
performance, and is constantly seeking results and improve-
ment. It is an intensely practical approach, seeking to
secure the maximum involvement Of managers in the setting
of standards and targets within the parameters Of the

 

”SAndrew M. Brown, Management Development and Management by
Objectives, (Bombay, India: Somaiya Publications, 1970), pp. 15-16.

 

 

l+6John W. Humble, Management by Objectives in Action, (Berkshire,
England: McGraw-Hill, 1970). p. 29.

 

50

company Objectives, resources, and environment. It is
dedicated to the belief that the important individual
motivational forces are people's desires to improve
performance, to know how they are getting on, and to
be recognized by others, and to feel that they are
being consulted and participating in the planning

Of their work. Participation brings with it commit-
ment to the Objectives agreed, and hence facilitates
peak performance.”7

Participation must be real, not contrived, stated Humble:

"For participation to have any meaning, it must be
essentially participation with the boss who must be
prepared to share his thinking and decision-making
with his subordinates and to make frequent contact with
them.

 

"The change in behavior must, therefore, start with

the head Of the unit, and where this is unlikely to be

achieved (for example, some executives have personalities

which preclude such a permissive style Of leadership),

then true participation at lower levels within the unit

will not be successful."”8

Who is responsible for implementing MBO in an organization?
Morrisey stated that "all members of management and, to a certain
degree, all employees have a responsibility in the implementation of

MOR (his term for MBO was Management by Objectives and Results).

In fact, without reasonable cooperation at all levels, the likelihood
Of substantial success is quite limited.”9
Responsibility for executive direction must be fixed. In the

context Of school administration, the responsibility must be placed

on the Superintendent. McConkey made this point very clear

 

”7Brown, 9p;_Cit., p. 63.

”BHmnble, 9p_._Cit., p. 217.

ugGeorge L. Morrisey, Management by Objectives and Results,

(Reading, Massachusetts: Addison-Wesley, 1970), p. iv.

51

‘when he stated that "without exception, every successful MBO
program has borne continuously, from its very first day of implemen-
tation, the clear and unmistakeable mark of the chief executive

Officer. n50

Morrisey defined three levels Of management as follows:

Top Management usually includes the Board of Directors,
the executive Officers, and in some cases, the heads Of major
functional organizations such as production, marketing,
financial, etc. The role Of this group, normally, is to
establish company policies, and to determine broad, total-
company Objectives, beginning with a clear determination Of
the company's roles and reason--its reasons for existence.
Top management will also specify, where they are appropriate,
Objectives related to such things as major product lines,
major markets, total sales, profitability, research and
development, etc. This group is concerned primarily with
the large scale "what-tO-do's" and relatively little with
the "howetO-do's".

 

Middle Management is made up of those managers, frequently
department heads, who have other members of management reporting
to them who are responsible fOr multi-organizational activities.
Their starting point is clear determination Of their own roles
and missions, which encompass those of their subordinate
managers and directly support those of their superiors. From
that base, they determine their own Objectives, which will be
most concerned with such things as departmental production
output, operational break-throughs, cost effectiveness,
departmental managerial effectiveness, etc. This level of
management is about equally concerned with the "what-tO-do's"
and the "howetO-do's".

 

First-line Management represents supervisors over
individual employees who carry out the tasks required to
meet the Objectives of the organization. As with managers
in the other categories, their Objectives begin with a clear
determination Of their own roles and missions. However, these
roles and missions should have been largely defined by their
superiors in keeping with those Of the department or organization
represented. Subsequent Objectives will, in general, be short—
term in nature and directed toward such things as unit output,
individual productivity, employee development, scrap reduction,
production schedules, overtime, etc. First-line managers

 

50McConkey, 9p;_Cit., p. 7.

52

generally have a heavy concern for the "how-to—do's" and

a relatively modest one for the "what-to-do's" much Of

which will have been defined by their superiors.51

The length Of time required to implement MBO successfully
will vary from organization to organization. In general, a commit-
ment to implement MBO should be made with the knowledge that the
commitment is being made fOr a minimum Of three years. Howell
believed it takes four to five years to achieve a fully effective
management by Objectives system.52 Morrisey stated that the normal
time required to implement MBO successfully in a reasonably large
organization (more than fifty members of management) is from three
to five years, stating that benefits will accrue during each year,
however.53

Other authorities with practical experience have indicated
that at least three years must be allowed to implement totally
management by Objectives. Little will be accomplished in most
instances during the first year. The second year should bring
modest results, and the third year should produce good results.
MBO requires a change in leadership style. The first year is taken
up by developing understanding of the concepts and practicing the

basic principles involved, including increased delegation. The manager

 

51Morrisey, 9p;_Cit., p. iv.

52Robert A. Howell, "Management by Objectives--A Three Stage
System", Business Horizons, XIII, NO. I (February, 1970), p. #5.

53Morrisey, 9p;_Cit.

53

must allow his subordinates to fail, as stated by Humble:

stated:

How do you get a man to feel that he can make
decisions? Usually by helping him lose his fear Of
making an error. How can you alleviate the fear Of
making an error? Generally, by applying what we call
the Rule Of Errors: If a man has a responsibility
for a result, he should be_permitted to make the
normal errors expected in making_the normal decisions

 

 

 

necessary to achieve the result.°

 

Howell summarized the need for allowing adequate time when be

In my estimation, it takes three years Of concerned effort
on the part of a management to introduce management by Objectives
into an organization. Many managements want a quick solution
and are not willing to spend this length of time. First, the
individuals in the organization should write Objectives for
themselves in collaboration with their superiors. The super-
iors should, in turn, conduct frequent evaluations Of their
personnel. Second, the individuals would establish more
measurable Objectives for themselves and start the integration
Of Objectives in the organization. During both the first and
second year, I see performance evaluations as a strict super-
visory responsibility. Third, the organization can start to
employ peer Objective setting, thereby achieving the lateral
integration Of desired Objectives. It can also place further
emphasis on periodic review and reestablishment Of Objectives,
finally introducing the concept of multiple performance
evaluation. At the end Of three years, which to some managers
is a long time to wait fOr results, the management by Objectives
approach should begin to have a strong, favourable effect on the
organization.

The procedures advocated by various authorities successfully to

introduce and initially implement a system of MBO vary widely at first

glance.

However, aside from terminology, there is much commonality in

the approach. Morrisey advocated introducing the program to successive

levels

Of management with a slightly different approach at each level.56

 

51'Humble, 9p;_Cit., p. 98.

55Robert A. Howell, "A Fresh Look at Management by Objectives",

Business Horizons, X, NO. 3 (Fall, 1967), p. 57.

 

56Morrisey, Op; Cit., pp. xiv-xv.

5H

McConkey listed only three main steps in the process: (1) a briefing

session for managers, (2) manager-subordinate review sessions, and

(3) the fOllow-up or review step, Often referred to as feedback.

57

Hughes suggested eight steps in the goal-setting process, as follows:

8.

Establishing specific goals to support stated
purpose.

Determining the importance of these goals.
Making plans for action.

Arriving at performance standards and measurement
criteria.

Stating anticipated problems.

Weighing the resources required to carry out the
planned action.

Providing the interaction Of organizational and
individual goals.

Following up with actual perfOrmance measurement
and evaluation.

There are a number of sequences in introducing and implementing

MBO illustrated in Humble's book. However, he summarized the steps he

believed to be representative Of the mainstream Of thought in this area

as follows:

1.

Critical analysis of the company's Objectives and
problems and establishing specific improvement goals.

Setting up task force and individual responsibilities
to secure the improvements.

Using key results analysis to examine management jobs
and establish performance standards, control data, and
authority.

 

57McConkey, Op; Cit., pp. 92-97.

58Charles L. Hughes, Goal Setting,(New York: American Management
Association, 1965), p. 92.

 

55

4. Reviewing managers' performance and potential.

5. Building up individual group training plans.

6. Planning succession and careers.59

McConkey60 and others advised moving slowly in the initial
stages of implementing management by Objectives. From the literature
three stages involved in successfully implementing MBO in an organ-
ization can be identified as (1) an orientation or briefing of managers
stage, (2) the initial operational or implementation stage, and (3) the
final Operational stage wherein the management by Objectives process

becomes continuous and systematic.

Chapter Summa§y_

While Peter Drucker first coined the phrase, George Odiorne is
generally regarded as having refined and systematized the process called
Management By Objectives.

Based on participative management strategies enumerated by
McGregor and Others, it consists Of a process whereby the superior and
subordinate managers in an organization mutually identify major areas
of responsibilities in which the subordinate will work, set standards
Of performance and a means of measurement of results against those
standards.

Many applications are recorded in the literature Of the implemen-

tation Of MBO and numerous sets of initiating guidelines exist. There

 

59Humble,_Op_L_Cit., p. 280.

5°MeConkey , g); Cit.

56

are, however, many fewer illustrations Of successful maintenance Of
MBO. It appears that several important factors exist, in fact,
that tend to hinder the implementation as well as the maintenance
Of this process. Chief among them being lack Of high-level commit-
ment and a lack of means for adaptation and modification to occur
as circumstances warrant.

It also appears that when conditions are appropriate within
an organization, MBO can be successfully implemented and sustained
with a relatively high payoff in accountability, creativity, and jOb

satisfaction.

CHAPTER III
RESULTS OF THE INTERVIEWS
The Eastwood Plan Of Management By Objectives

In the Introduction to Chapter I, organizational problems
were reviewed which led the Eastwood Board of Education to the
implementation of a Management By Objectives program. The conceptual
framework which underlies MBO was established in other sections of
both Chapters I and II. It is necessary at this point to specifically
refer to the MBO program which was initiated in the Eastwood organization
and with which the "exempt" administrators were operating. This plan
is contained in Appendix I which includes the following major components:
Working Definitions
Twelve Step Cycle (Note: This document
was the basis and the fOrmat for
installation Of the program. The
final nine steps became the Operating
model for maintaining the program.)
Communications in Management By Objectives
The Goal Project Cycle
Measuring the Unmeasurable

Goal Review Form

Individual Performance Appraisal and
Personal Development Report

Summary Recommendations

57

58

The Goal Project Cycle Chart is included here in Figure l
as a reference with which to interpret interview responses and as
a helpful summary to the entire Eastwood MBO program.

The positions which were a part Of the interview process are
listed in Figure 2, and, except in two cases, were all the second and
third—level "exempt" administrators who had personally been participating
in this MBO plan from the time Of its inception to the time of the
interviews. Two positions, namely Assistant in Personnel and Employee
Benefits Administrator, were fourth—level administrators.

As previously indicated, the method of questioning should be
considered unstructured, although the format followed the "funnel"
approach; that is, the questions gradually became more specific
as the responses became more specific. The sequence Of the major
questions discussed was as follows:

1. Please explain the process Of Management By Objectives
as currently practiced.

2. How do you feel about this process?
3. How do other "exempt" administrators feel about it?

u. Have your own feelings about the process been consistently
maintained?

5. What has occured to change your mind or substantiate your
views?

6. DO you feel it is an effective management process?

7. How should or could it be modified to better suit the
needs of the organization and the "exempt" administrative
staff?

Administrators listed in Figure 2 have been designated as "A"

through "K" on a random basis and are not related to the order in which

they appear on the list.

59

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"EXEMPT" ADMINISTRATIVE POSITIONS INTERVIEWED

(Individuals in Position Since September, 1968)

Associate Superintendent - Administration
Associate Superintendent - Research Services

Administrative Assistant - Public Relations

Director - Elementary Education

Director - Special Education

Director - Vocational 8 Technical Education
Director — Pupil Personnel

Director - Personnel
Director — Data Processing
Assistant - Personnel

Administrator — Employee Benefits

SCHEDULED BUT NOT INTERVIEWED

(Unavailable at Scheduled Time)

Chief Accountant

61

Interview Responses

 

Question #1 - Explain the process of Management By Objectives as

(A)

 

currently practiced.

 

It is based on our Management Handbook. It is an orderly manner
of laying out scheduled work a year at a time; the orderly
completion of activities not anticipated, based on achievement
Of goals and Objectives, more appropriate, valid. It gives a
person the opportunity to get rewards based on performance.

I will present to my supervisor in late Spring a list Of
Objectives or goals which I wish to accomplish-~personal goals,
improvement of job activities, and regular duties and respon-
sibilities. The list is presented to my supervisor in dialogue
to check, review, delete, add to, or modify the Objectives.

In addition to the list, individual goals are added at any

time as they arise. There is dialogue in each case; then,

I work to achieve them.

Evaluation is in early Spring. My supervisor and I sit down

to review achievements.

Pay determination follows evaluation conference. Strengths and
improvement areas are discussed at the conference.

At the preliminary dialogue, my supervisor and I agree on goal
statements and the target dates.

Supervisor might say superior, or average, or less than adequate.
The criteria he uses are:

Did I accomplish it?

(B)

62

At the time specified?

The manner by which it was accomplished.

Degree of difficulty.
My overall evaluation (final) is highly "negotiable" and is
dependent on my ability to convince supervisor of quality Of
work. Outside Of completion dates, the qualitative assessments

are judgmental on the part Of the supervisor.

District-wide goals were not furnished this year. We were
concerned that our goals may not be harmonious with other
divisions. Divisional goals will be coordinated by the super—
visor. We really feel a need for district goals. The first
year with MBO the district goals were too general and we could
not relate to them.

Goal setting occurred last summer and there was good understanding
at that time. Now report forms have to be filled out for my
supervisor's use to evaluate me. I have felt a lack of inter-
departmental coordination. There is no general recycling.
There are many comparisons to the stability Of the first year
process and the lack of continuity with that. There were no
goal review forms used this year. NO follow-up this year like
the interim checkpoint system.

I would expect "more than adequate" to be assigned, based on my
previous experience with being rated on other goals. I do not
consider the expectation Of "superior" since access to that
category is so severely limited. I really have no conception

Of what it takes to achieve "superior" ratings. Industry has

(C)

(D)

63

much better, more Objective criteria to use in assessing

results, qualitatively.

The practice is tO submit goals to be completed the following
year. We are held accountable at the end of the year for goal
achievement. It is a very loosely organized system Of goals.
We found our directions turning out differently this year
because Of union problems. To some extent we forgot our goals
because Of other problems we had to solve. We are so involved
in day-tO-day work that we have not worked problems into the
process and instead are solving emergency goals.

I prepared my current list Of goals in January. I expect to
be held accountable for these at the annual review. My super-
visor and I did agree on goals but did not discuss measures

Of assessment which would be used.

I do not know if or how my supervisor will rate any one of the
goals. I assume he will use some kind Of scale. I do not know
what criteria will be used. I do not know how to achieve
"superior" rating. A formalized evaluation process will be
taking place soon at which time all goals and other things

will be evaluated.

It is a method to accomplish more. You review previous year's

goals and the timing Of them, and attempt to better coordinate

district and departmental activities.

A list of goals is made three times a year. The first list is

reviewed and rewritten three times a year. The list is kept by

me. Some verbal discussions take place.

(E)

6“.

My supervisor goes over the general duties of my job, checks
the list, and points out things I might have omitted. There
is no discussion Of measurement criteria at this point.
At the end Of the year, the list is turned in to my supervisor
with my own assessment of progress made and my supervisor assesses
performance. I do not know what it takes to achieve a "superior"
rating, or any rating for that matter.
The purpose Of the verbal discussion is to assess overall aims
for the year. The process is repeated once more later; then,
the perfOrmance review is held. Goals are filled out on a form
supplied by the district in order of importance and turned in
tO the supervisor who uses them tO develop an overall rating.
Each goal is reviewed and evaluated in terms Of the supervisor's
perceptions. The supervisor uses the following criteria:

I. Workability;

2. Smoothness of Operation;

3. Completeness;

u. Does it cause other problems?

It is essentially a subjective analysis by the supervisor.

I don't think MBO is practiced at this time. If it were, we would
be identifying goals. We would first recognize district Objectives.
I am not aware Of any since it first started. It does not Operate
from district level. At the divisional level I am not conscious Of
district Objectives or division Objectives related to the district
in a systematic way. I have infOrmal contact with district goals
through conversations with others. On the other hand, I person-

ally believe in district Objectives from the bottom up.

65

I think I should have a variety Of goals tailored to needs Of my
job and district needs. If there were stated district goals,
mine should be related in some way. I have a nasty suspicion
that district Objectives are not mentionable, such as:

breaking the teachers' union, a financial commitment to strapping
the district. I have not filled out a goal fbrm in two years and
even when I did, it did not function right. We have never had

a smooth Operation up and down of a goal-setting process.

There is no dialogue on specific goals with the supervisor on
mutual commitment, definition of evaluation criteria or
completion and assessment of perfOrmance over that goal.

People do not want tO mess around with the paperwork nor to
specifically state the goal nor the manner Of assessment.

In the 1968-69 school year I had forty Open goals. There

was no systematic method Of approval, follow—through, or how
they were assessed. It's like a Virginia reel with no one

else to lock arms with.

I last prepared my own list of goals in November, 1971. There
has been no conference yet with my supervisor to discuss them.
My supervisor does not know I'm doing most Of these things.

I don't know what my supervisor's goals are. I don't know

when I will be evaluated, but I have submitted my Adminis-
trative Evaluation Report with my list Of goals in all
categories February 18, 1972.

I have no evidence as to how I will be assessed on a particular

goal. I think my supervisor should think about instances of

(F)

(G)

66

of my conduct in leadership situations and decide how I did in
contrast to one year ago. I expect the assessment tO be the
judgment Of my supervisor based on the results I achieve.

I don't know how my supervisor perceives leadership. I'd

like to know what his perceptions are so I could continue to
improve on his terms. It would be helpful to have a conference
on our perception of goal statements at the time of accepting
them as goals. I don't think my supervisor has thought about

criteria on assessing performance of my goals.

Are we practicing it? It's a statement Of Objectives and goals.
Both short and long range, with periodic evaluation. You must
first understand the process through in-service training; then,
make a comparison of Objectives with job specifications. Goals
are sub-items Of Objectives. A list of objectives must be
written up; then, goals are reviewed and approved by the
supervisor. Adjustments are made by both at a conference and
then reviewed annually. I have no clear-cut definition of what
superior performance is or will be. I do not know what criteria
my supervisor will use in evaluating my perfOrmance.

(Goal example is given here).

My supervisor doesn't really know what's involved. To him it
looks routine. If he knew all that's involved, he would be
able to give a more accurate evaluation. I think the super-

visor's criteria is the number Of complaints.

It is a formalized plan Of accountability for "exempt" administrators

and the Board Of Education. Each year Objectives and goals

(H)

67

are established relative to my jOb. I use the jOb description
as a basis. We were advised to omit day—to—day activities by
our supervisors since these have to be done anyway. We tried
creative goals but didn't have time fOr creative and personal
goals. These are unachievable. The ones I select are based

on items in my jOb description.

A dialogue with my supervisor adds to, deletes, or modifies the
list. At the conclusion, we agree on what my goals are for the
year. We agree also on the degree of achievement.

Goals should be more clearly defined and specific since they
are tOO loose and general, and measurement consequently is more
difficult. I don't always know what measurement indicators are
to be used in the subsequent evaluation by my supervisor. It

would help if I did.

As I'm aware, it is not practiced in a form that we originally
learned. A supervisor tells his subordinate to list goals
appropriate for his job. You are evaluated on the regular

job plus goals. NO distinctions are made as to creative and
personal goals. Merit pay is not based on goal achievements
to original extent. The whole thing has been tempered by
three or four influences since the beginning. The consultants
had not trained staff to same degree Of awareness. There was
inadequate explanation and improper orientation.

The turnover of top-level personnel has been a factor. New
people uncommitted to MBO are here now. The only thing

remaining is goal setting. We are still straining with growth

(I)

68

problems. Politics is another influence. Certain elements
of MBO have faded away. Some people are being evaluated on
a political basis rather than goal achievement. Public
pressures sway the evaluation Of personnel.
I list my goals when advised to do so. These are studied by
my supervisor and adjusted and revised based on higher—level
needs. Agreement is finally reached.
(Goal sample provided).
There was no discussion as tO how I would be evaluated on this
particular goal. My supervisor's criteria:

1. That I have worked on this extensively;

2. That I have provided periodic written memos
relative to topic;

3, Verbal reports;

4. Informal verification from others.
My supervisor did not spell out in advance the measurement
criteria be is using. The assessment will take place subject-
ively at review time. I do not know how well I did on that goal
until he tells me. He may rate it high or low and he may or may
not tell me why. I don't think we get an individual rating on

each goal.

It's quite informal this school year. A minimum Of attention

is given to sequential accomplishments Of goals and any specific
evaluation has a generalized approach.

The list Of goals is very general. NO target dates are specified.

NO sub-elements. I arranged a conference with my supervisor tO

(J)

69

discuss these goals. The conference dealt with mechanics-—not
whether they should be done but whether they should be on the
list. My supervisor and I established priorities for me outside
of the MBO conference. It was more subjective than before and the
conference was devoted to fitting into the formal structure that
which we want to do rather than what is actually done.

The MBO process emphasizes attention to Special jobs, projects
and improvements.

The final record of performance rating takes into account more
than the agreed upon goals. Very little time is given to MBO
per se.

(Sample goal is provided).

There are no performance or success criteria indicated. I am
unable to distinguish between expected perfOrmance in terms of
various ratings. The overall rating on total performance and
individual goals is made on subjective judgment Of the super-
visor. There is emphasis On results, generally. Regular,

routine, recurring jobs are not a part of the fOrmal MBO process.

The theory is good but the application is distorted. The emphasis
is on philosophy. People are trapped when they make Objectives;
they can be used against you. It's a way Of organizing to me.

The concept is fantastic. We have operated day-to-day. If MBO
were implemented, we could reduce problems. Currently, it's
totally individual. I don't know what the Objectives Of others
are; they're tOO individual. I know mine but don't know the

Objectives of others and I think I should know.

(K)

70

I need to know what "X" is planning to help me plan better.
When some other departments make Objectives, they frequently

involve me.

It's a means Of determining a salary increase, period, and

not even that is clear. Because we all got contracts the

same as last year's. It's not being implemented properly.

It's not being oriented to new staff. There is no reinforcement.
There's been no in-service since the Winter of 1970.

I took goals and Objectives set by the Superintendent and the

Board and these were division goals. I lifted those most pertinent
to me and made them my own.

(Sample goal was provided).

There is no evidence that my supervisor reviewed goal accomplishment
on this item in terms Of my administrative perfOrmance.

The measurement criteria were to actually complete the sub—tasks.
My supervisor does not currently consult with me in the goal-
setting process in very many cases.

I didn't check with my supervisor on recent goals to lock them

in and commit ourselves to them because he's too busy and is not
cognizant of the needs of the community and the Board. There are
too many changes, too fast, too recently, making it impossible

to coordinate MBO. New people are not oriented because there

are too many things to do. I couldn't care less whether or not

my supervisor evaluates me on goals I like to do. I don't know

how my supervisor can evaluate me on anything. He doesn't know

how it works or what M80 is. I use MBO independent of the "exempt"

MBO structure.

71

Summary of Responses--Question #1

 

While all Of the administrators referred to the act of setting
goals as fundamental to the process and most Of them included some form
Of evaluation, no one described a sequence Of activities designed to
accomplish the purposes for which the MBO program was originally
initiated at Eastwood. Further, no two of them described the process
in a similar way with respect to (1) known organizational Objectives,
(2) known divisional Objectives, (3) interim goal review, (u) final
review, (5) measurable results, or (6) feedback networks.

Collectively, the responses appear to describe a series Of
variations Operable at the discretion of either the supervisor or
subordinate within a division or department without organizational

coordination.

Question #2 - How dogyou feel about thisgprocess?

 

(A) I like the concept of developing long-range plans. I like to
share plans with my supervisor.
I do not believe supervisors should determine merit pay but

rather all merit decisions should be made by one or a panel.

(B) I think they think it's a farce. They don't put meaning on the
process. Negotiations shot the work schedules of several people,
for example. There are a couple Of exceptions in the building
who take it seriously. Generally, it's something you have to put

up with.

(C)

(D)

72

It needs a lot of refinement. There's no continuous fOllow
up. We seem to make goals at the beginning and we should have
a chance to make adjustments during the year as new jobs come
up.

I don't think we've put the time into it to make it really
operate. MBO is more time consuming to Operate correctly

than to administer without it. Somebody tells us to do it,

so we do it. The goals that we agreed upon are not always

the most important things we have to do. We sometimes add
things just tO make a list. We should have just two or three

major things. The whole job description is really a goal list.

When you're working, you must put goals aside to tackle emer-
gency problems.

My goal is to get through the day.

The formalities of MBO are a little superfluous at times. We
frequently have to drop goals and fOrget about them. I sometimes
wonder if we are the only department that does this? I have no
clear indication what other departments are doing with MBO. I
don't know how my goals tie in with my supervisor's goals and

the district goals. They ought to. Time seems to be the priority
here. I feel a lack Of conscious control over my goals and their
attainment due to exigencies Of the job; crises and emergencies.
At times, MBO appears to be a nuisance because there's not much
we can do about it due to intervening factors.

The routine of the job is not part Of the goal process and yet

takes most Of the time.

(B)

(F)

(G)

73

I feel we miss many Opportunities to use a good way Of articulating
work Objectives. We have the mechanism but we're not putting it

to work.

Originally, success criteria were more clearly known to the super-
visor and me. I feel the process could be more helpful. More
study and restudy is necessary. We're only giving lip service
because of the School Board's demand. I'm sure if the previous
Superintendent were here, MBO would be more sophisticated. We
only spend a day or two per year on it. If it were used properly,
it would make me a better administrator. I would like to use it
more effectively, but I need help and support. My supervisor

says "cut out all that detail garbage and make it simple".
Accomplishment is really not supported by any Objective evidence.
I see a great deal of merit in MBO but MBO does not currently

exist in the district as I understand it.

It's still in its growth stages. Much progress is to be made.

It merits further work and study. One factor inhibiting effective-
ness is time. It is still considered as a game or academic
exercise; something to be done after the real work is done,

if there's time.

Currently, it's about 50% effective. We've reached the half-way
point, but continuing to improve.

I think many are afraid of it. As we reduce judgmental factors

and increase Objectivity of it, peOple will be less afraid.

We have to find ways to measure quality Of achievement. I think

people fear looking at quality measures. There exists a lack of

(H)

(I)

(J)

7L1

consensus regarding what quality is.

We need more empahsis of end results rather than activity.

MBO as a process is inherently more time consuming than non—MBO.
We haven't had time to devote to learning and practicing MBO
processes. In-service time is very necessary. There's more
incentive not to practice MBO than there is to practice it
because Of time limitations, staff shortages in Central Office,
which inhibit the practice of MBO.

The overall rating score is, at the present time, relatively
subjective.

I can, however, detect movement towards Objectivity.

I guess I thought favorable Of it from the beginning. I didn't
agree with much of the criticism I heard from others. I haven't
had the problems others have had.

Discipline Of work planning is good.

Learning room for trouble-shooting is realistic.

The means whereby you and your supervisor can mutually agree on
as to what is important is good.

We aren't using yardsticks to measure but this doesn't bother me.

I feel it is superior to the extent of detail that the consultant
would put us to. It's a compromise between no communication and
that which the consultant expounds.

I would like to see more coordination at the cabinet level.

I'm neutral. I have no idea how effective it is. I've always

operated by it even befbre the district implementation. I only
1

 

(K)

75

list those goals that I'm damn sure I can accomplish and get
a good rating on.

Those above you have a tendency to use all aspects of a goal
to evaluate and then aren't aware of the external forces
causing me to deviate or change a goal.

My overall list Of concerns is used to draw out good goals
(easily accomplished) to patronize the upper echelon. My own
working goal list is what I use to Operate the department and
these are not part of the evaluation format.

The criteria used to evaluate goals on the goal review form
are: If they are accomplished-~it's not important how well.
I have no idea what my supervisor's criteria are going to be in

evaluating my goal accomplishment.

For use by myself I am very happy with MBO.
For the "exempt" structure, it is not functioning. It has been
set aside and is considered as a means to reach a dollar or

salary determination.

Summary of Responses--Question #2

In general, feelings were more positive than negative. There

appeared to be considerable internalization of the potential for improved

communication and at the same time an individually-oriented belief that

the MBO plan had helped them in some way and that with further effort

or more coordination, greater benefits could yet be realized for them

as well as the organization.

76

Question #3 - How do other "exempt" administrators feel about it?

(A)

(B)

(C)

(D)

(E)

(F)

(G)

A lot Of them agree with the concept but because of (the manner)
implementation (we jumped into it). We set goals in retrospect,
after the fact, rather than preplanning goals. If we had time
and effort we could do a better job as a whole "exempt" group.

I don't believe the "exempts" are practicing MBO.

It currently saves me time the way I do it as opposed to non-

sharing, non—goal-setting processes.

MBO is nice but we don't want it.

I just don't know. I wonder if they are doing and to what extent.

It hasn't found favor among "exempts". It was never clear just
what it was. It was as if MBO people flew in, flew out and left
us with this process without complete or full understanding Of

what it was. (I feel) bewilderment at times.

I think they feel it is a nuisance. They hold it in some
contempt. Newcomers have no training in MBO. They don't seem

motivated. Our original motivator was external.

We don't have, or discuss this. I have no knowledge Of how they

feel about it.

Others have accepted MBO as something here to stay. It has been
forced on the "exempt" administrators. I think that a slim
majority Of "exempts" would vote to retain MBO.

I think fewer and fewer games are being played. There's less

(H)

(I)

(J)

(K)

77

lip service and more practice.
Non-exempts are fearful of it. They don't believe unionism
and MBO are compatible.

They think that unionism would have to be subordinate to MBO.

I suspect some of them feel we're not even using it.
Some feel we're using the basic elements.
I don't know how they like it. It's not discussed anymore.

It's a passe item.

I don't know. Just meet the minimum. No complaints.

Same way I do. They are more concerned about self-preservation
than I am. They think it's a big game. The upper echelon
really wants me to put down what is pleasing and non—threatening

to them and to the Board.

They laugh at it. They don't think it's being practiced as it

was taught.

Summary of Responses-—Question #3

 

While Question #2 responses indicated some internalization of

potential value, the responses here, somewhat surprisingly, tend to

indicate that, as it appears to the individual, others either do not

practice it or do not value the process.

Question #9 - Have your own feelings about the process been consistently

(A)

 

maintained?

 

No.

(B)

(C)

(D)

(E)

(F)

(G)

78

Originally I had certain reservations. The district was sinuoro
about trying to get MBO started. There was a moment that I felt
sort of excited about it. It seemed to center on the final
rating. I saw the initial enthusiasm slowly die and it changed

to something that had to be done.

It seems there should be a group review of accomplishment and
review of progress and a look at the district position. I don't
know how the top boss really feels about it.

(It's) helpful in planning and keeping my boss informed. It keeps

you honest.

My other duties like working with principals and curriculum
improvement are more important to the district as opposed to

my list of goals.
I think I've mellowed toward it somewhat.

I had a positive reaction at the beginning. It seemed like a
good process. My feeling is the same but I now have (negative)
feelings about implementing it. I was using this method prior
to November, 1968. It seems to have been implemented wrong

by immediately tying it to salaries. The authoritative manner

of implementing induced resistance to it.
I still think it could be a valuable tool and a big help.

I have felt the same way right from the beginning. But I didn't
have a chance to vote on it when it started. There seems to be

a lack Of commitment to the process.

(II)

(I)

(J)

(K)

79

The decision by the Board to implement this without choice has
been a major inhibitor. Had we voted negatively, those in favor,

I think, would have moved to experiment with it.

Mine has been generally positive.

Before (the consultants came in) we had a real need for pre—
planning. I had hoped the MBO process could effectively help
us. (The consultants) plan is a little too detailed for the

time we have available. It requires more time than we have.

Originally I honestly thought it could be terrific. We have
distorted it to meet needs of recognition and prestige Of

individuals.

I thought a lot better of it originally.

Summary of Responses--Question #9

 

In general, it appears the program was implemented with some

anxiety and uncertainty on the part of the group as well as hope that

such a system might be helpful and that these feelings have remained

essentially unchanged.

Question #5 - What has occured to change your mind or substantiate

(A)

 

your views?

 

We have moved away from the firm practices of 1968. Maybe
because Of other work. There is a lack of MBO coordination.

We didn't articulate it, in—service it, or share it.

(B)

(C)

(D)

(E)

(F)

(G)

(H)

(I)

(J)

80

Nothing.

(There was) a real bad start with MBO, (involving the) method

Of presentation. (The consultants) didn't relate it to a

school (environment). Our problems are different. We floundered
first couple of years in identifying Objectives which we could
measure. We still don't have any. Goals assessment should be

very small part Of (our total) evaluation.

Writing objectives has helped to organize my work somewhat and the
fact Of sitting with the boss helps to determine his priorities

in terms of my work.

We should have been started without reference to salaries until
after it was well established, perhaps on a pilot basis. It

didn't matter that I did not vote on it.

NO responses.

No responses.

NO responses.

No responses.

I thought it would be helpful in solving real problems with honest
and Open communications but it turned out to be putting down
philosophical problems which are non-threatening and don't hurt

anybody.

81

(K) Because the "exempt" and the Board agreed to work together
and share an interaction of people but these seminars have

not taken place.

Summary of Responses--Question #5

The responses here tend to be somewhat contradictory to those
of Question #u in that the consensus of those discussing this question
indicate that some changes in application either have occurred or should

have occurred which have weakened or should have strengthened the plan.

Question #6 - Do you feel it is an effective management process?

(A) Not as good as it could or should be. Because Of the above
reasons.

(B) Yes, it does provide supervisors more control over subordinates'
performance.

(C) NO, too confined, no fOllow-up, no goal adjustments during review

period. We haven't defined "goal” adequately.

(D) Vaguely, no. Because we don't really know what it is all about

and whether we are utilizing it as we should.

(E) I don't feel it exists right now. We are using such a small

fragment of it it's not fair to assess MBO as a process.

(F) No responses.

(G) You constantly know where you stand.

You know where you are and how to justify your existence.

82

(It has) helped budget development. We are familiar with each
other's goals at this level. The lower echelon should exchange
goal information also.

(I'm) much happier with salary determination with MBO.

I don't have to back up to the pay window.

It's much easier to explain to citizens as to what we are doing.
We are more accountable with it even though we still have

problems.

(H) It is effective but probably not nearly so much as if it were

being used properly.

(I) Yes, because it gives attention to goals above and beyond the
job and helps in the coordination Of them. It establishes the

expectation for looking beyond the job description.

(J) I don't think so. It is a distortion of the original intent.
It has come to meet the needs of those above at the expense
of my needs. I don't think the real prOblems were ever acknow-
ledged. I had the feeling my job was on the line if I listed

and recognized the real problems of this department.

(K) It's not being practiced as I originally understood it. I have
not been involved in the process so I am unaware of the fact
Of implementation. It's not being perfOrmed or executed as

written in the Management Handbook.

83

Summary of Responses-—Question #6

There appears to be considerable indication that, as practiced,

it is not currently an effective management technique but that there

still exists potential for greater payoff with additional review and

modification of the program.

Question #7 - How should or could it be modified to better suit the

(A)

(B)

 

needs of the organization and the "exempt" administrative
staff?

 

We have to approach it as a total group, understand it together,
and then practice it reinforced by: in—service time and large
group-learning sessions.

I really think it is a good program if we could get it on the
right track. I feel that in many cases goals are not being

established until after the fact.

The Superintendent (should) create one or two district goals.

He should then give it to the cabinet to pass down to depart-
ments to determine how they can carry these out. This should

be done prior to budget development. After that, and crossing
department lines to achieve coordination, the information should
go back up to inform top management how the goals are being
carried out.

The Superintendent and Board would then commit themselves to
these goals when they approve the budget.

At the end Of the year after evaluations, top management should

tell the "exempts" how we met the district goals, what went wrong,

(C)

(D)

(E)

84

and there should be a discussion of how to improve.
There seems to be a lack of top-level commitment to MBO and

(consequently) we are pretty much on our own.

(We should) go back to define district-wide goals annually.
Let's really hit one or two new areas each year. Each division
can determine how best to help the district reach these goals.
Each department, of course, will have other department goals
over and above these district goals.

(We should) find school-oriented people to consult with on the
MBO process. (It's) difficult to define expected outcomes in

educational functions and processes.

The key is communications: to supervisor; how we relate to

one another. We don't seem to be pulling together.

Maybe once a week have department meetings; someone with the
"big view" to tell us to do this or de-emphasize that.

I don't know how this department relates to district problems.
Are we all little islands?

Maybe (we should) employ more initiative as individuals. I need
to know where the department head wants to go.

(We) need lots more communication regarding directions, purpose,

and priorities Of our work.

The Board should identify and restate the district objectives.
Some programs should be started or emphasized using district
goals. (This would be) a visible test of the fact that MBO

can work. It would provide an example to others.

(F)

(G)

85

Supervisory people should be motivated to give recognition

to people who set goals. I have found great resistance to

my goal setting. My efforts have been pigeonholed. It seems
too hard to do.

Maybe the Board should clearly abandon it as too cumbersome,
too paper-oriented, so as not to pretend anymore. I think if
I went around I would find that goal setting is not taking
place. (There is) very little systematic approach to the

whole process.

I would have another in—depth training program to make sure
everyone understands it in the same way to achieve uniformity

of approach. Primarily, we need to be together on this. We
need to coordinate our division's goals with those Of the
district and other divisions. We should have tried the process
out before tying it to merit pay. I think that is the big

thing that killed it. They (the organized administrators)
laughed at it and I'm sure it had a lot to do with the formation

of their bargaining unit of administrators.

Evaluation criteria needs to be established with consensus.
Goal evaluation needs to be placed on a more Objective basis.
The concept that says only a (limited number) of employees
can earn merit should be modified. Theoretically, if all
administrators did superior work only (a limited number)

would earn superior pay.

(H)

(I)

(J)

86

I would make a district commitment wholeheartedly that this

is the way we're going to run.

I would go back to annual planning by all administrators in

late Spring. Long range Objectives must be developed in relation
to the budget. Periodic sessions (should be held) regarding
total team progress and new district pressures and problems,
outside of the regular work day. (We should) reestablish

firm team feeling and reaffirm our faith in MBO with common

understandings about the process.

We need more positive attention to what MBO is today. We
should define what it is and what is expected as the minimum
essential routine.

There are many different concepts. We have different inter-
pretations. We need more unity as to understanding the frame-
work. We should do goal setting prior to budget development
and also after budget development. We need awareness at each
level and a sharpening of coordination. There is need fOr
formal understanding of the process and results expected in
this district. Our Management Handbook has a lot Of language
which is not being used. The main emphasis should be in
arriving at a consensus decision about goals and how many Of

them are to be converted to paperwork.

I suggest each administrator be put in the position of stating
his honest Objectives and be accountable for solving them and

to be evaluated by his peers. In a group of three I might have

a chance. My whole evaluation this year is going to be based
on whether I solve one particular problem, not how well I do
on all the others. I would like to be more accountable to
the Board than I am and not have to go through the chain of

command.

(K) We should spend some money on a thorough in—service program
to explain the process. Include the Board and all "exempts".
We all need to know the details of the process, the necessary
relationships, the value of it, how does it function and how
to relate it to the activities of the individual administrator.
It might have worked better if dollars (salary) had not been
immediately tied to it. The existing system has to be thrown

out and started over.

Summary of Responses--Question #7

There appears to be a high level of agreement that by re-
defining district Objectives on an annual basis and by providing
in-service opportunities to discuss this MBO plan, significant value
and improvement in its application could be achieved. It also appears
that a formalized feedback mechanism, while not specifically mentioned,
is being asked for; one which makes possible or requires communication

as confusion or other problems develop.

CHAPTER IV

ANALYSIS, CONCLUSIONS AND RECOMMENDATIONS

Analysis of Interview Responses

 

While the schematic shown on Figure l (Page 59) indicates the
MBO process cycle begins with a review of department Objectives, none
of the eleven administrators mentioned this as being a part of the
current process. In some instances there appeared to be a felt need
for designated district objectives with which to identify, such as:

"At divisional level I am not conscious of district

Objectives or divisional objectives related to the district

in a systematic way."

"I think I should have goals tailored to needs of my job
and district needs."

"If there were district Objectives, mine should be
related in some ways."

"District goals were not furnished this year."

The next two steps whereby the subordinate sets his own goals
and these are reviewed at the beginning of the performance period
appears to be taking place for most of them. According to the responses,
however, there is little or no systematic agreement or detail developed
in the next three steps which call for:

1. Joint agreement on goals and measures (to be used to
assess performance, both quantitatively or qualitatively).

88

80

2. Goals converted to projects and scheduled.

3. Agreement on projects, resources required and scheduled.

The technical aspects of goal development appeared to be
relatively informal and the degree of internalization seemed to vary
from individual to individual as evidenced by their concern expressed
in these comments:

"A minimum of attention to sequential accomplishment of goals and
any specific evaluation. It's quite informal."

"NO specifics or target dates. No substantive elements."
" C O O O O C O t,
There 18 no d1scus51on of measurement cr1ter1a at th1s p01nt.

"I do not know what it takes to achieve a superior rating, or
any rating for that matter."

"My supervisor and I did agree on goals but did not discuss
measures of assessment which would be used."

It also became evident that lists Of goals in some cases were
quite fluid and changed within the dimensions of individual discretion.

"To some extent we forgot our goals (this year) because of
other problems we had to solve."

"I didn't check with my boss on recent goals I selected
because he's too busy."

"There's too many changes too fast, making it impossible to
coordinate MBO."

In the actual execution Of stated goals and the evaluation
of them at the performance review step, the administrators had
considerable difficulty in sensing a high degree of correlation
between the two or Objectivity in the review process. For example,
the following excerpts from the interviews point to this difficulty:

"Assessment will take place subjectively at review time."

 

90
"I think he (supervisor) will evaluate me primarily on
initiative."

"Some people are being evaluated on political basis rather
than goal achievement."

"Public pressures sway the evaluation."

"I only list those that I'm damn sure I can accomplish
and get a good rating on."

"I think my supervisor's criteria is the number of
complaints."

"I don't know how my supervisor can evaluate me on
anything. He doesn't know how it works."

The feeling that assessment based on goal achievement was
not taking place was universally expressed and that the assessments
made were highly subjective by criteria which were not usually known
to the subordinate.

Lastly, there was no mention at all of updating department

objectives for a subsequent review period.

Overall Perceptions Of MBO Process

 

Overall, the responses indicated an identification with and
internalization of some parts Of the process which the administrators
found personally useful. There appeared to be a universal disappointment
with the implementation of the process as a whole.

The actual breakdown of this plan of MBO as a functioning
process appears to have been acknowledged through such key statements
as:

"It needs a lot of refinement. There's no follow—up.
To do it right would be much more time consuming."

"I don't think MBO is practiced right now."

 

"It's not being implemented prOperly."

"Merits further work and study. Still considered
as a game. Something to be done after the real
work is out of the way."

"I would like to use it more but I need help."

"MBO does not exist as I understand it."

"The theory is good but the application is distorted."

Perceived Acceptance By Others

 

In general, those interviewed tended to feel that others
had somewhat the same regard for the process as they did, although
a frequent response was that they didn't really know for sure,
indicating a lack of communication on this particular topic.

Some of the more relevant comments were:

"I suspect some of them feel we're not even using it."

"Same way I do. They think it's a big game."

"It hasn't found favor among 'exempts'."

"A lot Of them agree with the concept."

"They laugh at it."

"I think they feel it is a nuisance."

Perceptual Alterations Over Time

 

Most indications were that the administrators involved in
this MBO plan felt much more positive about it when it began but
that it had not lived up to their expectations. Declining acceptance
is best revealed as follows:

"I had a positive reaction at the beginning."

"I thought a lot better of it originally."

 

92

"Originally, I honestly thought it could be terrific.
We've distorted it to meet the needs of individuals."
"I had hopes it could help us plan better but it would
take too much time to use (the West and Company) plan."

Perceptions of Evolutionary Deterioration of Plan

 

The majority of the administrators interviewed felt quite positive
about the potential value of the M80 system but that its current deficiencies
inhibited successful use of it, especially from an organizational point of
view. Several responses appear to center on the disintegration of coor-
dination as evidenced by:

"I don't feel it exists right now. We're using such a small
fragment of it that it is not fair to assess MBO as a process."

"NO. Too undefined. No follow-up. NO goal adjustments.
We haven't defined 'goal' adequately."

"It's not being practiced as I understood it. I have not
been involved in the process so don't know if it's being
implemented at all."

"It's a distortion of the original intent."

"We've moved away from the firm practice of '68. We lack
coordination and sharing."

"It's effective but prObably not nearly so as if it were
being used properly."

Individual Suggestions for Modification

 

Almost unanimous desire was expressed for more training, more
communication, more coordination and an Opportunity for problem-solving
discussions on MBO, such as:

"I would make a district commitment, wholeheartedly, that
this is the way we're going to Operate. I would also go
back to annual planning."

"Long-range Objectives must be developed in relation to

budget. Also, periodic sessions regarding total progress

of management team toward their goals with a review of upcoming
problems and pressures."

"We need more positive attention to what MBO is today. There
are many different concepts and we all have different inter—
pretations. We should have unity as to understanding the
framework."

"Need formal understanding of the process and the results
expected in this district."

"Suggest each administrator be put in position of stating
honest goals and be accountable for solving them."

"The key is communication with supervisor. How we relate to
one another. We don't seem to be pulling together. Maybe once
a week department meeting to review the big picture."

"I'd have another in-depth training program to make sure everyone

understands it in the same way. Primarily, we need to be together
on this. We need to coordinate our department and division goals

with those of the district."

"Evaluation criteria needs to be established with consensus."

"We have to approach it as a total group, understand it together
and then practice it together."

"It should be reinforced by in-service time and large group
training time."

"We need a thorough in—service program to explain the process."
"Existing system has to be thrown out and start over."

"GO back to defining district goals annually. Find school-oriented
people to consult with on the MBO process."

"The Board should identify or re—state district objectives.
Supervisory people should be motivated to give recognition to
people who set goals."

"At the end of the year, after evaluations, the top management
should meet with all 'exempts' and discuss how well we met
district goals, what went wrong and how we might improve as a
team."

Analysis of Consultant Technique

 

The conception, implementation and practice of Management By
Objectives in Eastwood Public Schools, when viewed from the perspective

of the literature and results as perceived by the local practitioners,

SH

are subject to several significant interpretations.

As previously indicated in Chapters I and II, the implementation
of Management By Objectives may be viewed as an Organizational Develop-
ment (OD) activity which, according to Wendell French, means a long-range

effort to improve on organization's capabilities in solving problems and

1!!

coping with changes in its external environment.1 He adds that the typical
OD objectives include the following:

1. Increase the level of trust and support among organizational
members.

2. Increase the incidence of confronting organizational problems 1
instead of "sweeping them under the rug".

 

3. Create an environment in which the authority of an assigned
role is augmented by personal authority based on expertise
and knowledge.

u. Increase the openness of communications, laterally,
vertically, and diagonally.

5. Increase the level Of personal enthusiasm and satisfaction
in the organization.

6. Find synergistic solutions to problems with greater
frequency.

7. Increase the level of self and group responsibility in
planning and implementation.

French's list contains many of the same concepts as does the
Eastwood consultant's in its purposes for MBO, especially with reference
to planning, communications and problem solving. Faulty communications
and inadequate planning are frequently referred to in the consultant's
report to the Eastwood Board of Education and, in fact, these two
processes are considered most important to a great many business

organizations.

 

lWendell French, The Personnel Management Process, (New York:
Houghton Mifflin, 1970), p. 552.

95

Before proceeding to an analysis of change models compared to that
used by the Eastwood consultant, it is appropriate to briefly summarize
the dimensions of the changes which they recommended. In their totality,
they may be viewed as a fundamental departure from past practice, involving
as they do, new sets of relationships with an administrator's superior
and subordinates in defining job tasks, setting written work schedules
and establishing individual accountability as well as a completely new

compensation package.

At any rate, once the need for change is established or becomes
apparent, as was the case with the Superintendent and Board of Eastwood
Schools, the way in which the organization perceives the change process

should be assessed in terms of some criteria to determine potential for

change such as these set up by Bennis:2

l. The client system should have as much understanding of
the change and its consequences, as much influence in
developing and controlling the fate of the change, and
as muCh trust in the initiation of the change as possible.

2. The change effort should be perceived as being self-
motivated and voluntary as possible. This can be effected
through the legitimization and reinforcement of the change
by the top-management group and by the significant
reference groups adjacent to the client system.

3. The change program must include emotional, value, and
cognitive elements for successful implementation. It is
very doubtful that sole reliance on rational persuasion
will be sufficient.

u. The change agent can be crucial in reducing the resistance
to change. As long as the agent acts congruently with the
principles of the program and as long as the client has a
chance to test competence and motives (his own and the agent's),
the agent should be able to provide the psychological support
so necessary during the risky phases of change.

 

2Warren Bennis, "Theory and Practice in Applying Behavioral Science
to Planned Organizational Change", in Emerging Concepts in Management, ed.
by Max Wortman and Fred Luthans, (London, Ontario: The MacMillan Co.,
1969), p. 208.

 

96

If, by client system, Bennis means those upon whom the change
is to be effected, the Eastwood consultant's process falls short, since
the decisions relative to the nature of the changes and the development
of action procedures were all established at the Superintendent and
Board level, prior to the implementation process. With the exception of
the Superintendent, there was no formal communication between the admin-
istrative staff and the Board of Education during the planning phase which
might have facilitated emotional involvement and feedback constructive
to the program. Once implementation began there appeared to be little
or no opportunity for modification of basic procedures or structural
relationships. It must, therefbre, be regarded as doubtful that the
process could be viewed by the staff as self-motivated or voluntary
to any significant degree.

The orientation program provided to second and third-level
administrators was entirely cognitive by nature since, again referring
to the West and Company report, they spent their time with individuals
developing goal-setting skills and their group time promoting "a basic
understanding of concepts, processes and methodology of MBO". One must
conclude that little or no effort was expended on the emotional or
psychological aspects of this change process as related to individual
values or informal group norms.

That such effort would have been important is supported by
Lawrence and Lorsch3 who suggest that considerable option exists in

determining how extensive the change program needs to be.

 

3Paul R. Lawrence and Jay W. Lorsch, Developing_Organizations:

Diagnosis and Action, (Reading, Mass.: Addison-Wesley, 1969), p. 87.

 

CHANGE TARGET

97

METHOD

COG—EMOT MIX

 

Modest Change_

 

1. Interaction
patterns

2. Role
expectations

3. Orientations
and values

u. Basic motives
achievement,
power , etc.

 

Fundamental Change

New paper coordination
methods, budgets, schedules,
new communication Channels.

Intensive educational
programs, new divisions of
labor and authority structure.

New reward systems, different
leadership styles.

New selection criteria, replace
incumbents, major strategy
changes.

 

Cognitive

Emotional

 

 

As the change target becomes more widespread or fundamental, the

emphasis on developing and working with emotional factors becomes

increasingly important.

Normally, intervention strategies designed to induce permanent

change in values, procedures and supervisor-subordinate roles require

more than simply "rational persuasion" and most change models reflect

this by including team development and/or laboratory sessions as well

as feedback systems and planned evaluation procedures as part of the

total process.

The consultant's model permitted or encouraged little or no

feedback due to its well-developed and detailed status and Board

commitment to it prior to the intervention stage.

In addition, there

was no role re-training, committee structure nor process evaluation

procedures built into the program below the level of Superintendent's

;v

 

98

cabinet. The closest that the consultant's model came to laboratory
training or team building were the "orientation" meetings with second
and third-level administrators where explanations and lectures were
provided to acquaint them with the details of the plan and instruct
them in the procedures.

Other important aspects of the implementation of MBO in the
Eastwood Schools and yet apparently not covered by the consultants in
their strategy, have to do with potential resistance to change and
conflict, both perceived and manifest. While these factors were beyond
the scope of this paper, it must be regarded as possible that they
influenced the success of the implementation as well as the perceptions

and behavior of the involved administrators.

Conclusions

 

Based on the perceptual responses of the administrators involved
in the interviews and the analysis of the consultant techniques and
strategies, it is concluded that:

l. The original purposes for implementing MBO stated by
the consultants in their report to the Board have
not effectively been met and its status appears to be
deteriorating. Improved planning and coordination
of effort are perceived, generally, as not occurring.
Individual and functional responsibilities as a result
of the MBO process are not recognized as clearly
designated. Communications between departments and
divisions are viewed as a growing rather than
diminishing problem and individual contributions
are considered to be identified by subjective means
not directly related to goal achievement.

2. Generally, participating staff view MBO as malfunctioning
or non-existent, although individually they profess to
use some segments of the process constructively in their
own work and support what they believe to be the theoretical
model of MBO.

99

3. They believe MBO to be a process over and above
their regular work routine and to fully integrate
it would be more time consuming. They expressed
differentiated deviations from the policy model at
almost all steps of the process and strongly felt a
lack of conformity within the organization.

u. By and large they feel it has or is disintegrating
through an overall lack of district objectives,
coordination, in-service and communications.

In assessing the role of the consultant in this intervention
process as essentially a cognitive force, it is entirely possible that
Lewin's (19u7) three-phase analysis criteria were not met in any one or
all three phases. The "unfreezing" process may not have been complete
since internal and group values were apparently not dealt with in any
systematic way. There was considerable structural "movement" which did
result in some behavioral changes as evidenced by a residue of commitment
to and practice of segments of MBO. In addition, the consultants left
it to the organization to "refreeze" and this may never have occurred.

Using Lippitt, Watson and Westley's seven—phase change model
(1958) as a comparison base, it is conceivable that while the Super-
intendent and the Board recognized a need for change, the involved
administrators, though participating in the orientations with enthusiasm,
may not have actually "felt" this need. Also, there appears to have
been little or no cognition of alternative solutions to the nature of
the organizational problems. Stabilization of the new level of function-
ing was likely not complete nor continuity assured at the time of departure
of the consultant.

Looking at Marguilies and Raia's organic consultative model (1968),

it would appear that the consultants acted as the only technical re-

sources in this process, tended to focus only on problem solutions and

100

were highly task-oriented as opposed to process facilitators.
Argyris (1961) speaks on the subject of client dependence and the
marginal role of consultants which may have been a factor in this

instance. He states that:

". . . .most client systems are usually composed of two sub-
systems. On the one hand is the group which desires to see
the organization change. On the other hand are all those
who are either not aware of a necessity for change, or
disagree as to the proper direction for change, or resist 1
any attempt at change. . . . .If he values one sub-culture
over the other, then his behavior will be perceived as
'management-dominated' or 'employee-dominated', depending
upon which sub-culture he values most and who is doing the
judging. Consequently, . . . .his behavior will not tend i
to be efficient."”

...I ‘fi‘ An' .- ..

 

While this aspect of consultant role is beyond the scope of this
report, it may point to a possibility of inefficient attention to the
change process resulting in over-dependency of the client system through
almost exclusive use of cognitive techniques. Argyris contends that:

"A consultant who is interested in helping the organization
achieve its needs in such a way that it can continue to do
so with decreasing 'outside' aid must give attention to the
processes by which the new plans are developed, introduced,
and made a part of the organization. He will tend to invite
a much greater degree of participation on the part of the
clients in all phases of the program. Such participation,
if it is not to become bogged down, will have to be based
on effective interpersonnel and group relationships."

 

The role consequences and general effectiveness of the consultant
agency are subjects for further study. On the basis of the review here,

it is possible, if not probable, that these factors played an important

 

”Chris Argyris, "Explorations in Consultant-Client Relationships",
in Organizational Development: Values, Process and Technology, ed. by
Newton Margulies and Anthony Raia, (New York: McGraw Hill Book Co., 1972),
p. 518.

5Argyris, p. 520.

101

part in the technical implementation and subsequent administrative
perceptions of the change process leading to Management By Objectives

in Eastwood Public Schools.

Recommendations

It is important at this point to emphasize the distinction r?
between Management By Objectives implementation and operation. The
process of implementation represents an intervention strategy in the

life of an organization and usually a fundamental change from past 5

 

“‘1: .'.-

practice. Operation of MBO, on the other hand, is represented by the
procedural aspects of a functioning system over time. While it is not
possible here, to state that operational effectiveness is dependent
upon the effectiveness of implementation, it appears that operational
malfunctions may be a product of implementation techniques as well as
design characteristics of the system.

Based on the interviews contained herein, an analysis of the
change agents approach and the resulting conclusions, it is suggested
that public school districts implementing a system of Management By
Objectives for its management staff, should consider the following:

1. A high-level commitment to adopt a system of Management
By Objectives should include provision for maintaining
this commitment over a considerable period of time.

2. The implementation system should include techniques which
will facilitate the internalization of the concept and
operational aspects on the part of those who will be
involved in it. In addition, the Operational system
itself should provide appropriate and frequent oppor-

tunities for feedback and staff orientation, especially
in the early stages.

10.

102

A key administrator or representative committee

of involved personnel should be appointed with respon-
sibility and authority to periodically evaluate

the operational aspects of the system and develop

and carry out necessary modifications.

Major objectives fer the district as an organization
should be reviewed and established on a regular basis.

Training sessions, on at least an annual basis, should
be conducted fOr all who are participating in the MBO
program.

Departmental or small group meetings should be
sdheduled and conducted for the purpose of assessing
departmental effectiveness based on use of the system.

Procedurally, the system should encourage and then
permit comments, suggestions, and concerns from
individual participants regarding system effectiveness.

Considerable training and follow-up in-service should
be devoted to improving individual ability to develop
relevant, clearly-stated and organizationally-important
objectives. This should be accomplished, in part,
through group analysis of actual objectives previously
established by individuals in that organization.

Resource persons with expertise in Management By
Objectives and/or management systems generally should
be introduced into the organization's feedback and
in—service system on a periodic basis.

The Superintendent and Board of Education of a functioning
MBO district should be aware of and participate in the
analysis of system malfunctions and subsequent modifications.

BIBLIOGRAPHY

 

BIBLIOGRAPHY

Books

Argyris, Chris. "Explorations in Consultant-Client Relationships."
Organizational Development: Values, Process and Technology.
Edited by Newton Margulies and Anthony Raia, New York:
McGraw Hill Book Company, 1972.

Benson, Charles S. The Economics of Public Education. Boston:
Houghton Mifflin, 1961.

 

Brown, Andrew M. Management DevelOpment and Management By Objectives.
Bombay, India: Somaiya Publications, 1970.

 

Conference Board. Managing By and With Objectives. Study No. 212,
New York: Conference Board, 1968, p. 21.

Drucker, Peter F. The Practice of Management. New York: Harper and
Brothers, 1954.

Etzioni, Emitai. Modern Organizations. Foundations of Modern Sociology
Series. Englewood Cliffs, New Jersey: Prentice Hall, Inc.,
1969.

 

French, Wendell. The Personnel Management Process. New York: Houghton
Mifflin, 1970.

 

Hughes, Charles L. Goal Setting, New York: American Management
Association, 1965.

 

Humble, John. Management By Objectives in Action. Berkshire, England:
McGraw Hill Book Company, 1970.

 

Lawrence, Paul R., and Lorsch, Jay W. Developing Organizations:
Diagnosis and Action. Reading, Massachusetts: Addison-
Wesley, 1969.

 

 

Mali, Paul. Managing By Objectives. New York: John Wiley and Sons,
1972.

 

McGregor, Douglas. Leadership and Motivation. Cambridge, Massachusetts:
M.I.T. Press, 1966.

 

103

10a
McGregor, Douglas. The Human Side of Enterprise. New York:
McGraw Hill Book Company, 1960.

Morrisey, George L. Management By Objectives and Results. Reading,
Massachusetts: Addison-Wesley, 1970.

Odiorne, George S. Management By Objectives. New York: Pitman
Publishing Company, 1965.

Olsson, David E. Management By Objectives. Palo Alto, California:
Pacific Books, 1968.

 

Schleh, Edward C. Management By Results. New York: McGraw Hill
Book Company, 1961.

 

Articles
Bennis, Warren. "Theory and Practice in Applying Behavioral Science
to Planned Organizational Change." Emerginngoncepts in

 

Management, Edited by Max Wortman and Fred Luthans, London,
Ontario: The MacMillan Company, 1969, p. 208.

Carroll, Stephen J., and Tosi, Henry L. "What is Management By
Objectives?" The Economist, CCXXXV, No. 6609, April 25, 1970,
p. 60.

 

Howell, Robert A. "A Fresh Look at Management By Objectives."
Business Horizons, X, No. 3, Fall, 1967, p. 57.

 

Howell, Robert. "MBO - A Three Stage System." Business Horizons,
February, 1970, pp. ul-uu.

 

Ivancevich, John M. "A Longitudinal Assessment of Management By
Objectives." Administrative Science Quarterly, XVII, No. 1,
March, 1972, pp. 126-135.

Kennedy, John D. "Planning for Accountability Via Management By
Objectives." Journal of Secondary Education, Vol. 45,
December, 1970, pp. 3&8-35u.

Mahler, Walter R. "A Systems Approach to Managing By Objectives."
Systems and Procedures Journal, October, 1966, pp. l—5.

 

Mansergh, Gerald G. Dynamics of Management By Objectives for
School Administrators. Metropolitan Detroit Bureau of
School Studies, 1971.

 

Maslow, A. H. "Theory of Human Motivation." Psychological Review,
L, 19u3, pp. 370-396.

 

 

105
McConkey, Dale D. "20 Ways to Kill Management By Objectives."
Management Review, LXI, No. 10, October, 1972, pp. 4-13.

McGregor, Douglas. "An Uneasy Look at Performance Appraisals."
Harvard Business Review, May/June, 1957, pp. 89-95.

Molander, C. F. "Managing By Objectives in Perspective." Journal
of Management Studies, IX, No. 1, February, 1972, pp. 7u-75.

Odiorne, George S. M.B.O. Newsletter. Volume 2, No. 8, August, 1972, p. 3.

Perko, John E. "The Human Side of Management~~People Make Systems Go." a
CASBO Journal of School Business Management, XXXVIII, No. 2,
November, 1972, p. 17.

Strauss, George. "Management By Objectives: A Critical View."
Training and Development Journal, April, 1972, p. 10.

 

Unpublished Documents

 

Eastwood (Michigan) Public Schools. Minutes of Meeting of the Board
of Education, 1968. (Mimeographed).

West and Company. Organization, Compensation and Management By
Objectives Studies. Chicago, 1968. (Mimeographed).

 

APPENDIX

 

EASTWOOD PUBLIC SCHOOLS

 

WORKING DEFINITIONS

 

MANAGEMENT BY OBJECTIVES: The total process of developing objectives

and establishing and implementing action to achieve managerial goals.

MANAGEMENT BY RESULTS: The quantitative and qualitative appraisal
of achievement and the application of this knowledge to performance

improvement, promotion potentialities and salary consideration.

OBJECTIVE: A broad statement of purpose.

A guide to action.

GOAL: A specific measurable target which is consistent with

organization objectives.

TASK: One or more steps or activities designed to achieve a goal

result.

WEST AND COMPANY, INC.

106

 

107

EASTWOOD PUBLIC SCHOOLS

 

TWELVE-STEP CYCLE

 

THREE PRECONDITION STEPS

 

l. Analyze and determine organizational climate.

2. Determine if the plan is to be implemented fOr entire
organization or if it is to be installed on a pilot basis.

3. Train individuals in the concepts of Management By Objectives.

NINE RE-CYCLING STEPS

 

1. Establish long-range objectives for the organization.

2. Review the organization structure, revise commensurate
with definition of functions and objectives.

3. Unit head prepares unit objectives.

u. Unit personnel propose individual goals based on unit
objectives.

5. Supervisor and subordinates reach joint agreement on
subordinates' goals, target dates and standards of
performance.

6. Implement goal-achievement activity.

7. Feedback and review of interim results and against
sub-targets and standards.

8. Final review and evaluation of performance following
completion of a target date.

9. Re-cycle.

WEST AND COMPANY, INC.

 

108

TWELVE-STEP CYCLE

 

FOR INSTALLING

 

MANAGEMENT BY OBJECTIVES

 

A. THREE PRECONDITION STEPS

 

l. Analyze and determine organizational climate.

a. Is the organization structured to permit two—way
communication? Has it been effective?

b. Is the attitude generally one of "goal" rather than
"task" orientation?

c. Is management "results" oriented or "pressure" oriented?

d. Has the organization exercised the concept of planning
(immediate, short-range and long-range) and implemented
programs based on this?

e. What is the decision-making process? Where does it
occur? What is the pattern of involvement? How

effective is it?

2. Determine if the plan is to be implemented fbr entire
organization or if it is to be installed on a pilot basis.

a. Decision is influenced by size of organization and
evaluation of organization climate.

b. A pilot program should involve a "key" division or
department which has considerable visibility to rest
of organization.
3. Train individuals in the concepts of Management By Objectives.
a. Most effective procedure is to use seminar method.

(1) Use peer groupings.

(2) Follow down through the organization to lowest
level of participation.

b. Material to be presented should be condensed to the
essentials and based on need to know.

WEST AND COMPANY, INC.

 

C.

109

An effective format would be to review and study
the nine "operating" steps which begin with Step #u
in the installation cycle.

B. THE NINE RE-CYCLE STEPS

1. Establish long-range objectives for the organization.

a.

The long-range plan should be prepared by senior
management.

A long-range plan contributes to:

(l) Direction of total organizational effOrt
towards an agreed-upon objective or objectives.

(2) Coordination of diverse efforts towards the
"same" objectives.

(3) Objectivity in measuring results.
Long-range plans should encompass the total enterprise.
Long-range plans should include:

(1) Objectives one to two years out (short-term or
intermediate).

(2) Objectives five years out (long-range or long-
term).

(3) Provision fer evaluating progress.

(H) Provision for updating.

2. Review the organization structure, revise commensurate with
definition of functions and objectives.

a.

C.

Is structure consistent with stated plans of the
organization?

Is the division of responsibilities adequate to
facilitate achievement of stated objectives?

Are lines of authority clear and understandable?

3. Unit head prepares unit objectives.

WEST AND COMPANY, INC.

C.

110

Unit objectives are derived from objectives and
goals of next senior unit or directly from
objectives.

These serve as a guide to total action fOr the unit,
later to be reduced to specific goals for individual
activity within the unit.

Unit Objectives are reviewed with subordinate personnel.

Unit personnel propose individual goals based on unit
Objectives.

a.

A proper form of goal can be timed and measured
and is consistent with unit Objectives and assigned
responsibilities.

A goal must be attainable but at a high performance
level.

Goals fall into four general classifications:

(l) Routine goals.--Related to perfOrmance of
routine responsibilities.

 

(2) Emergency goals.--Not elective, must be
achieved due to outside pressures.

(3) Innovative goals.--Elective goals which are
creative.

(u) Personal development goals.--Goals having to
do with developing capability.

Preparing plans for action and implementation.

(1) To establish individual goals, participating
personnel should:

(a) Review unit Objectives with, and as
outlined by, unit head. Determine and
note specific areas fOr individual con-
tribution.

(b) Review job functions and note objectives

that should be given direct attention
based on job requirements.

WEST AND COMPANY, INC.

(2)

(C)

(d)

(e)

(f)

(g)

(h)
(i)

111

Prepare listing of matters which should be
accomplished in the coming year but are not
of a routine nature.

List opportunities which should be taken
advantage of.

Rephrase each item on these lists as
separate and distinct goals.

Evaluate each goal in light of its
practicability and importance to the
objectives of the unit.

Determine which goals can and should be
accomplished this year.

List the goals in order Of their importance.

Review the resulting list of goals with unit
head and jointly modify, eliminate or add.

To develop strategies to accomplish goals, participating
personnel should:

(a)

(b)

List what must be done to accomplish each
goal.

- Develop practical alternatives.

- Arrange approach in a logical sequence
of steps or tasks for implementation.

- Establish target and sub-target dates.

Determine the resource requirements necessary
to accomplish specific goals.

- Determine if goal achievement is to be
individual or through task fOrce.

- Set up a "planning worksheet" for each
goal.

- Determine, or estimate, the personnel,
financial, equipment, material, facilities,

policy and procedural requirements.

- Assign responsibility.

WEST AND COMPANY, INC.

112
(c) Determine the coordination with other units
necessary to achieve goals.

— List the information or action needed
from other units.

— List information or data that other
units will need for effective cooperation.

- Discuss information and assistance needs
from coordinating units with responsible
personnel in each such unit.

- Set time phases on cooperative achievement.

(d) Establish realistic standards of performance
for each goal.

(e) Document the procedure.

(3) Review documented plan and procedure for implementation
with the unit head for final approval.

Supervisor and subordinate reach joint agreement on subordinate's
goals, target dates and standards of performance.

a. Supervisor must evaluate subordinate's ability to
achieve goals; determine also if goals are less than
individual's potential.

b. Each level of management has a communication respon-
sibility to develop understanding and secure support.

(1) Top management must know:
(a) Purpose and limitations.
(b) How to set Objectives.
(c) What goals are.
(d) How to communicate and motivate.
(2) Middle management must know all of the above plus:
(a) Capabilities Of each participant.

(b) How to translate objectives into goals
and coordinate goals.

WEST AND COMPANY, INC.

113

(c) Business economic techniques, e.g.,
equipment justification.

(d) How to coach and counsel subordinates.
(3) First line managers must know:

(a) Purpose of plan and their role in it.

(b) Problem-solving techniques.

(0) HUman relation techniques.

c. Communication in implementation requires subordinate and
superior to alternately exercise the concepts of informing,
persuading, exploring and deferring.

(l) Long-range plan:
(a) Determination at top levels.
(b) Communication is from top down.
(2) Setting Objectives:

(a) Determined by executives at same level.

(b) Communication is first horizontal, then up
for approval and finally down to inform
subordinates.

(3) Setting goals:

(a) Dual determination, superior and subordinate.

(b) Communication is first up to superior, then
up and down to discuss goals, targets, and
standards and to agree upon action, then

down to subordinate as final approval.

(c) Superior communicates up to his boss to outline
intended course Of action.

(d) Subordinate then communicates down to his sub-
ordinates and begins a repeat of the process
he just completed with his superior.

6. Implement goal achievement activity.

a. Publish Gantt-type chart and review this carefully

WEST AND COMPANY, INC.

11”

with cooperating personnel emphasizing master
target dates and sub-target dates for specific
goals.

b. Review information and action-flow charts and
other types of control charts with COOperating
personnel to assure understanding as to how the
goal achievement is to be programmed and controlled.

C. Determine that all cooperating personnel have copies
of all control and time charts.

Feedback and review of interim results against sub-targets
and standards.

a. Carefully identify progress to date against proposed
or desired results.

(1) Note failures and reasons fOr failures.

(2) Program corrective measures to put task elements
and timing on track.

(3) Readjust schedule to satisfy changed or previously
not identified conditions.

(A) Review status with superior.

b. Drop inappropriate goals, suggest new goals to reflect
new input and review this changed status Of intended
goal achievement with superior for approval.

c. Accumulate periodic reviews with copies to superior.

d. Superior must develop, implement and fOllow through
with an on-going program of review of each subordinate's

activities. This should be both fOrmal and informal.

Final review and evaluation Of perfOrmance fOllowing completion
of a target date.

a. Review (subordinate and superior) achievements against
anticipated goal results (prescribed by standards and
statement of desired results). ‘

(1) Identify areas of success and areas of failure.

(2) Determine causes of less than successful achievement.

WEST AND COMPANY, INC.

 

115

b. Counsel results with subordinate.

(1) Agree as to strengths and weaknesses of
achievement.

(2) Outline a program to avoid repetition of
determined errors in performance and short-
comings in basic program.

(3) Determine, tentatively, if goals not fully
achieved should be dropped or considered for
re-implementation in next period.

c. Translate evaluation of results to reflect on:

(1) Salary administration.

(2) Summary report Of performance review.

(3) Specific areas for individual perfOrmance
improvement.

(a) Identify only areas where the potential
fOr improvement exists. ’
(b) Jointly prepare a program fOr improvement.
a. A review and reevaluation of long—range objectives
fOr the organization.
b. Review the organization structure.
c. Unit heads prepare unit objectives.
d. Etc.

WEST AND COMPANY, INC.

 

 

 

 

 

 

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117

EASTWOOD PUBLIC SCHOOLS

 

MEASURING THE UNMEASURABLE

 

SETTING GOALS TO MEASURE THE UNMEASURABLE

 

It is Often necessary to devise measurements of present levels
in order to be able to estimate or calculate Change from this
level.

The most reliable measures are the real time or raw data in
which the tangible results involved comprise the measures to
be used. (Dollars of sales, tons of output, number of home
runs hit.)

When raw data can't be used, an index or ratio is the next
most accurate measure. This is a batting average, a percent,
a fraction or a ratio.

If neither of the above two can be used, a scale may be
constructed. Such scales may be "rate from one to ten",

a nominal rating against a Checklist of adjectives such as
"excellent, fair, poor", or one which described "better than"
or "worse than" some arbitrary scale. (These are useful but
are far less precise than the above.)

Verbal scales are the least precise but can be extremely
useful in identifying present levels and noting real change.
Verbs such as "directs", "Checks" and "reports" are indicative
of actions to be taken.

General descriptions are the least useful, but still have value
in establishing bench marks for change. "A clear, cloudless
fall day" is Obviously not the same as a "Cloudy, foggy, misty
day" and the two descriptions could be used to state conditions
as they exist and conditions as they should be.

The statements Of measurement should be directed more toward
results than toward activity. (Much activity may prove impossible
to state in specific terms, whereas results of that activity can
be so stated.)

In stating results sought or in defining present levels, effort
should be made to find indicative, tangible levels and convert
verbal or general descriptions into such tangible scales, ratios
or raw measures where possible.

If you can't count it, measure it, or describe it, you probably
don't know what you want and Often can forget it as a goal.

WEST AND COMPANY, INC.

118

EASTWOOD PUBLIC SCHOOLS

 

GOAL REVIEW FORM

 

 

 

 

 

Name Date of Goal Approval
Title Date of Final Review
I. Statement of Goal Target Date

 

 

II. Interim Review

 

(a) Schedule
As Required Bi—Weekly Monthly Other

(b) Basis of Review

III. Final Review

 

(a) Specific strengths exhibited during achievement period:

(b) Specific improvement needs exhibited during achievement
period:

(c) Personal development action recommended:
(d) Organizational corrective action recommended:

(e) Rating Of accomplishment:

More Than Less Than
Superior Adequate Adequate Adequate

Signature of Incumbent

 

Signature of Supervisor

WEST AND COMPANY, INC.

119

EASTWOOD PUBLIC SCHOOLS

 

INDIVIDUAL PERFORMANCE APPRAISAL AND PERSONAL DEVELOPMENT REPORT

 

 

 

Name of Employee Date Of Review
Department Title
Name of Supervisor Title

When properly completed, this fOrm should facilitate the achieve—
ment of the fOllowing results:

1.

2.

 

 

Purpose of this Form

 

The complete and Objective evaluation of the performance

of the individual since the date of the last formal appraisal.
The establishment of appropriate perfOrmance and self-develop-
ment goals for the next year. E
An effective appraisal interview with the employee.

 

Instructions fOr Completion of this Form

 

The immediate supervisor requests the employee to describe

the major activities and/or goals he has been engaged in
during this period, in the activities column. The activities
must be listed in decreasing order of importance, i.e., goals,
by priority, then routine activities. Usually an employee
will only accomplish fOur to eight major activities during
the evaluation period.

The supervisor and the employee review the activities column
prepared by the employee to ensure mutual agreement of goals
and activities to be considered and their relative rankings.
The activities specify what was done or accomplished and may
explain how it was done where this is of importance. But,
judgement of how well it was done must be reserved for the
appraisal column.

The supervisor indicates in specific terms, the relati e
success the employee has had in achieving each of the
activities. He must make a special effort to indicate the
degree of achievement as well as indicating any factors
beyond the employee's control which might have contributed
to the observed results. Where possible, use objective
data such as comparison Of results with budget, proposed
programs, schedules, costs, etc.

WEST AND COMPANY, INC.

 

10.

120

The supervisor adds to this section any goals or
activities which have been completely neglected and
indicates the reasons why the omissions occurred.

In the "appraised evaluation" section, the supervisor
rates the performance of each goal and activity by
placing the number of the item in the appropriate
performance section or box.

The supervisor completes Section II—Performance Strengths
delineating the specific attributes which the employee
successfully applies to the performance of his duties.

The supervisor completes Section III-Improvement Needs
delineating the knowledge, skills or attitudes which the
subordinate must develop to maintain or improve existing
levels Of performance.

The supervisor determines the overall appraisal of
performance by considering:

(a) The "overall appraised evaluation" of achievement
of individual goals and activities, and

(b) The effect of goals and/or activities not having
been accomplished.

The appraisal is discussed in detail with the subordinate
and an improvement development plan is mutually agreed
upon and documented in the appraisal.

The completed and signed appraisal is included in the

employee's personnel records. The employee is given
a copy of the completed appraisal.

WEST AND COMPANY, INC.

 

121

 

To be completed by employee
and verified by supervisor

To be completed by supervisor

 

NO.

Goals and/or Activities Degree of Success in Achievement

 

 

 

 

 

WEST AND COMPANY, INC.

 

122

 

To be completed by employee
and verified by supervisor To be completed by supervisor

 

No. Goals and/or Activities Degree of Success in Achievement

 

 

 

 

APPRAISED EVALUATION

 

After tabulating individual achievements, check the
section which best describes overall achievement.

 

 

 

 

 

More Than 'Less Than
Superior Adequate Adequate Adequate
Performance Performance Performance Performance

 

 

 

 

 

 

WEST AND COMPANY, INC.

 

123

II. SUMMARY OF PERFORMANCE STRENGTHS

III. SUMMARY OF IMPROVEMENT NEEDS

IV. DEVELOPMENT ACTION PLAN (Mutually established by employee and superior)

V. OVERALL PERFORMANCE

 

More Than Less Than
Superior Adequate Adequate Adequate

SIGNATURE OF EMPLOYEE
. (Not necessarily signifying concurrence with this appraisaI)

 

SIGNATURE OF SUPERVISOR

WEST AND COMPANY, INC.

12M

EASTWOOD PUBLIC SCHOOLS

 

SUMMARY RECOMMENDATIONS

 

 

 

 

 

Employee Name Date
Department 6 Title Title
Prepared By

 

I. Overall Performance (As indicated on the last Individual Performance
Appraisal 8 Personal Development Report)

More Than Less Than
Superior Adequate Adequate Adequate

II. Status Recommendations (Read carefully before Checking your
recommendation)

Recommended for reappointment and promotion to

 

Recommended for reappointment to same position.
Recommended fOr reappointment and transfer to

 

Recommended fOr probation and reappointment to same position.
Recommended fOr probation, but reappointment and transfer

to

Recommended that individual's service be terminated.

III. Promotability

 

Promotable to
In six months six to twelve months Longer

IV. Salarijecommendation

 

Years in system Employee's age Years in current position

Salary Range

 

 

 

 

 

 

 

Salary Grade___ Minimum____ Midpoint___ Maximum
Current Salary - Current Zone
Last Increase Date Amount Percent
Recommended Salary Increase Amount Percent

‘ New Salary New Zone

 

 

SIGNATURE OF SUPERVISOR

 

APPROVAL OF NEXT HIGHEST SUPERVISOR

 

WEST AND COMPANY, INC.

"MMMMI