Business Skills



Management By Objectives (MBO)

The Six Stages


Peter Drucker, author of Managing for Results

Source: Managing for Results by Peter Drucker

Peter Ferdinand Drucker is revered as the father of modern corporate management. He was often called the world's most influential business guru. His thinking transformed corporate management in the latter half of the 20th century.




Starting from the top of a company, the six stages of Management by Objectives (MBO) are:

  1. Define corporate objectives at board level

  2. Analyze management tasks and devise formal job specifications, which allocate responsibilities and decisions to individual managers

  3. Set performance standards

  4. Agree and set specific objectives

  5. Align individual targets with corporate objectives

  6. Establish a management information system to monitor achievements against objectives