Theories and practices of the personnel evaluation via management by objective

Abstract

This study investigates how the Management by Objective (MBO) is utilized for the purpose of personnel evaluation. According to McGregor, personnel evaluation via MBO is more effective than traditional performance appraisals because MBO ratings are not only participative, constructive, and performanceoriented, but not focusing on personal character. Data from the 1998 Survey of Japanese Trade Union Confederation (JTUC-Rengo) was analyzed with regard to the fairness of evaluation system. Results found that compared with those who were rated by traditional performance appraisals, ratees in MBO were informed more of the evaluation system, were provided concrete performance objectives, and were fed back ratings more frequently. Those findings were also observed in the IBM Japan Business Effectiveness Survey results. However, an assumption that personnel evaluation via MBO is fairer as an evaluation system than traditional performance appraisals was not supported.