A term used to describe a method for achieving organizational objectives. Top management would set broad goals, then each subsequent layer below would identify how it would support and implement those goals, providing greater and greater degrees of detail. Dr. Deming notes that the result of MBO as practiced, will likely be suboptimization of the organization. Because there is a strong tendency to focus on the result (numbers), rather than on the systems and processes that produce those numbers, and because the typical reward system emphasizes the importance of those numbers, employees find ways to give management the numbers, often by taking actions that are not in the best interests of the organization.
Typically almost all MBO goals will fall under the CVQT framework - C = Cost, V = Value, Q = Quality, T = Time.
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== References ==