Management by Objectives (MBO): The 9 most common errors 


Management by Objectives (MBO) is a model that uses a company’s goals to set objectives for employees. These objectives can have all kinds of benefits for your team, from guidance and motivation to establishing standards and measuring performance. 

According to Forbes, “companies that set performance goals quarterly generate 31% greater returns from their performance process than those who do it annually.”  

There are many approaches you can take to Management by Objectives. Some training courses for example explain how to use SMART criteria (and its derivatives) to do so. But there are also errors that are frequently made in the process and can impact results later down the time.  In this post we explore these mistakes in more detail along with how to avoid them. 

Management by Objectives (MBO): What are the most common errors?  

Despite their advantages, many leaders don’t know how to set objectives correctly. Here are some of the most common errors in the MBO process. 

ERROR 1: Believing that implementing objectives will automatically produce the expected results 

Many leaders believe that merely making a decision and implementing it will bring results on its own.  

ERROR 2: Requesting participation without defining specific objectives 

Not providing guidance to the team while demanding results is a more common mistake in objective-driven leadership than one might think. Managers may have clear goals (or not), but they fail to specify concrete objectives or communicate them effectively to the team. This leaves collaborators feeling disoriented, pressured, and misunderstood. 

ERROR 3: Prioritizing paperwork  

Processes and standardization are positive when done correctly, but rigidity in management is not. Many managers are more concerned about procedural compliance than efficiency and results. This leads collaborators to focus more on “covering the paperwork” than performing their tasks correctly. 

ERROR 4: Not providing feedback 

In connection with error number 2, failing to communicate and inform the team about progress towards their objectives, causes them to lose perspective, and generates stress because they don’t know how close they are to achieving the expected outcome. 

ERROR 5: Linking rewards solely to performance

Many leaders “buy” their collaborators with awards and incentives. The problem with this approach is that some professionals tend to focus only on tasks that are rewarded. 

For instance, in the sales world, many sellers prioritize meeting sales targets because they earn commissions, neglecting administrative tasks, which are equally important but not rewarded (beyond their base salary). 

This error, common in the Management by Objectives process, might provide short-term solutions but compromises the long-term. These situations create individuals who will only act out of interest (usually economic) rather than professionalism. 

ERROR 6: Having objectives without developing action plans 

Objectives must translate into actions. Failing to do so leads to professionals: 

  • Not knowing what they should do. 
  • Not understanding how to do it 
  • Making excuses when they fail to achieve objectives. 

ERROR 7: Not recognizing the importance of ongoing training 

Many leaders neglect the training and development of their professionals, despite having high expectations. With this in mind, they expect employees to achieve an objective without providing the necessary tools to carry it out. This leads to demotivation, stress, and frustration. 

ERROR 8: Failing to lead by example from the top  

Leading by example applies to Management by Objectives as well. If the leader acts without adhering to standards, objectives, and procedures, themselves, the team’s strust will be compromised. 

When what is considered right changes from A to B without a clear reason, professionals won’t know what to expect, and productivity and efficiency levels can suffer. 

ERROR 9: Resisting delegation  

Another mistake some leaders make in managing objectives is wanting to control everything at all times. They resist letting go and do not grant autonomy to their teams. 

This behavior is often due to excessive caution, insecurity, or distrust towards their team members. In any case, this leads them toverburden themselves with work, pressure their team, and ultimately hinders their growth. 

While this article looks at nine of the most common errors related to Management by Objectives (MBO), they aren’t the only ones. Can you think of others? 

Yolanda Amores


Yolanda Amores

Chief Marketing Officer at isEazy

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