THE IMPACT OF MANAGEMENT BY OBJECTIVE (MBO) ON THE PERFORMANCE OF AN EMPLOYEE (A CASE STUDY OF LOPA ENERGY CO LTD)
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THE IMPACT OF
MANAGEMENT BY OBJECTIVE (MBO) ON THE PERFORMANCE OF AN EMPLOYEE
(A CASE STUDY OF LOPA
ENERGY CO LTD)
ABSTRACT
One of the many problem facing the
business community has been the problem of integrating the objectives of
the employees with that of the organization for the achievement of the
organization objectives. Even when such an integration has been made
there should be a dear method or system of measurement of the contribution of
employees to the organizational achievement. Organization that practice
management by objectives seem to be on the positive threshold of solving this
problem. Management by objective (MBO) is a systematic approach to managing an
organization practicing the basic management functions of planning organization
staffing leading and controlling. Management by objective is a result oriented
all functional area (LOPA energy co.ltd). the distinguishing characteristic of
management by objective (MBO) is its emphasis on results achievement of
objective. It is based on a concept of human motivation.
Accordingly it places emphases on the involvement of the employee in planning
directing and controlling aspects of the job what will be done when will it be
dome and how will it be done?
TABLE OF CONTENTS
Title page
List of table
CHAPETR ONE
INTORDUCTION
1.1
Background
1.2
Statement
of problem
1.3
Purpose
of the study
1.4
Scope
of the study
1.5
Research
question
1.6
Significance
of study
1.7
Limitation
of the study
1.8
Definition
of terms
Reference
CHAPETR TWO
2.0
Literature
review
2.1 Meaning of
management
2.2
Porter
lower model
2.3
Setting
of objectives
2.4
The
MBO process
2.5
Advantage
of management by objective
Reference
CHAPETR THREE
3.1
researcher
design
3.2
Area
of study
3.3
Population
of the study
3.4
Sampling
and sampling procedure
3.5
Instrument
for data collection
3.6
Validation
for the instrument
3.7
Reliability
of the instrument
3.8
Method
of data collection
3.9
Method
of data analysis
References
CHAPTER FOUR
Date presentation and analysis
Summary of results
References
CHAPTER FIVE
5.0 Discussion
recommendation & conclusion
5.1
Discussion
of findings
5.2
Conclusion
5.3
Implication
of the research findings
5.4
Recommendation
5.5
Suggestions
for further research
5.6
Reason
why ii is GOD to apply MBO
References
Bibliography
CHAPTER
ONE
INTRODUCTION
The underlying belief is that this
involvement of employee lead to commitment and if an employee is committed he
can be directed to perform in manner that positively contributes to the
achievement of organizational objects. The MBO afford both the superiors
and subordinates the opportunity to sit together and jointly identify common
goals of enterprise define individual major areas of responsibility term
of the results expected of him and use these measures as guides for operating
the unit and assessing the contribution of each of it misers. Paul Hersey et al
(1988) this leads to the four basic component of the MBO system.
a)
Setting
performance objectives and standards for their accomplishment
b)
Developing
action plans
c)
Coaching
and counseling
d)
Annual
performance appraisal
Management by objective should guard
against misdirection of common organizational goal by various functional
managers. Peter Durker (1981). The in depth in the assumption is
that organization that is well vested and excellence among its managers.
By jointly setting objectives between and the subordinate a mutual
understanding results. Employee now accept the responsibility and
works out action. Plan to meet performance standard set for the specific
job. MBO has psychological background. In order to understand and
benefit from MBO all employees who are includes in it must understand the
psychological principles on which it is based. When MBO is introduced
into a company a training course is therefore given which explains
Maslow’s hierarchy of needs Hertzberg’s theory of motivational emphasize
and Mc Gregor’s theory X and Y these emphasize the employees increase in job
satisfaction when he feels a sense of achievement & involvement in his
work. Unless MBO is carried out in this spirit it because merely another
method by which subordinates can be controlled. Graham (1985)
For a business to grow responsibility
is the only thing that will serve. Druker (1981).
Acceptance of responsibility removes
fear and spur up employees with an internal self motivation for
performance. When employee are motivated productivity increases.
Through management by
objectives (MBO) responsible worker emerge there is the contention that (MBO) brought
employee satisfaction. Nwachukwu (1988). Employees contribution is
recognized and rewarded through job performance appraisal system which is
an ingredient of management by objective (MBO)
One of the major
problem contorting the Niger civil service are intangible 50 are their result
that is to serve the people. This sound ambiguous and cannot easily be
subjected to any quantitative and qualitative education. To determine when a
civil service has become result oriented entails having specific limited dearly
defined target to be accomplished within a given time Nwachukwu (1988).
Management by objective enable prudent
utilization of resources setting of prionties and time as Druker (1977)
puts it only its target and defined can resource be allocated to their
attainment priorties and dragline be set and somebody be held accountable for
result”
Employees can be
denominated if an employees perceives that his contribution has not been
equitable compensated rewarded or recognized.
Coaching and
counseling are used to guide subordinates to be on the objective track.
In summary management
by objective in the recent years has been one of the most
striking developments in the managerial cut of getting result in an
organization. Significant number of firms small enterprise to giant
public corporation report accomplishment of a most astonishing and
profitable nature. When MBO is correctly applied it enhance work
simplification equitable compensation better utilization of equipment starting
a new business inventory control and organization clarity (Mali 1972)
It is clear from the
vast body of information and knowledge developing around (MBO) concept a
dynamic management way of life is steadily maturing and will remain
with as for sometime to come. This is informed by the fact that
management practitioners themselves are increasingly concerned with improving
ther own effectiveness with the use of management by objective (
MBO). The researcher work will examine the impact MBO on the performance
of the company LOPA Enugu Co.
Being a theoretically oriented
research work theories by eminent scholars as they affect the research topic
will be discussed. The objectives scope and innovative material offered
in this researcher paper should be of help to any manager at any organizational
level who is interested in increasing the results and quality of output of his
group or organization.
Additionally the
paper would provide meaning techniques increase their individual resulted in
the context of their job responsibilities. In only management employee
are includes in the MBO system that is employees who are only salary group 10
and above even those without experience or the fresh recruits.
Conversely employees on salary group
mine or below are excluded form MBO system irrespective of the many years of
experience that have had on the job. These level of employees performed
what the company referred to as “assigned tasks”. This study examined
management staff of the company could make to the MBO system to facilitate
accomplishment of the company’s goal and objectives.
1.1
A
BRIEF HISTORICAL BACKGROUND OF THE COMPANY
LOPA energy company
was co-operated and the year 1985 under the company’s allied matter act of 1965
amended in 1990 and registered the company’s name as LOPA energy Co Ltd ammonia
processing plant.
The company got its registered number
which is 176062 in 58 Awka Road Onitsha under the memorandum of association to
design commission operate and supply all kinds of petroleum plant which
includes liquidity petroleum gas (LPG) and also to set up and market all kind
of chemicals petro chemical plants organic and inorganic.
The company is floated by chief Bony
Alo and engineer Ansalem Alo on behalf of their other brother LOPA is located
at Emene Enugu East.
The company has branch and gas plant at
Abakiliki for the bottling of liquidity and gas plant petroleum gas
(LPG) and ammonia factory and gas plant at Enugu. Soon after the completion of
the company LOPA energy has a setback. The national fertilizer company of
Nigeria (NAFCON) entered into an agreement with LOPA energy and offered the
company and excusive leadership of her bye-product but (NAFCON) later reneged
from that co-actual agreement. So the company become a still birth out of
the wood and the problem were sowed until 1993. NAFCON was compelled by
federal government of Nigeria (FGN) to supply the product to LOPA energy Co-Ltd
and to respect with the company is agreement. Since then LOPA energy went into
active business as a result of this LOPA constructed an ammonia bending plant
for bending of anhydrous ammonia and the chemical name is NHZ.
So business blossomed on like a flower
and in expansion of business LOPA energy increased in the production of LPG and
this LPG is the cooking gas and brings to future dream. Now LOPA Enugu Co
Ltd is the only company that is supplying liquidity petroleum gas (LPG)
1.2
STATEEMNT
OF THE STUDY
Whether a business
enterprise deliver a product or service depending on the work of the number of
people whose effort must be marshaled and directed toward the a ultimate
objective. The organizing of drilling and producing on the other
hand and directing and motivating of employees on the other hand are two of
most important of the many essential activities of LOPA energy management.
No enterprises
has achieved significant economic and social development with our
clearly set objectives and stipulated performance standard. This main problem
addressed by this research was the relationship between management by objective
(MBO) and its significance impact on employee performance at LOPA energy
productivity is affected up front because of procurement of raw material
the refinery which product liquidity because the product is not regular even
the processing of raw material (NAFCON) The national fertilizer company of
Nigeria closed down so they import the material up till now.
In from of sales
company that patronizes LOPA energy has reduced as a result of importing of raw
material. The product will be very costly because of the raw material is
very made and used for the production the cost of the product will be
high. Some of the company has closed down because of the expensive of the
product (the any hydrous) which is used in some breweries for production of
malt and for cooling. Productivity is affected when stimulating
challenging and vigorous objective and performance standards
are established and the performance adequately rewarded a measure of
reinforcement
1.3
PURPOSE
OF STUDY
This study aimed at achieving the
following objectives or purpose:
1)
To
find out wither management by objective practiced in LOPA Enugu improve the
overall performance of the company
2)
To
find out the extent of management involvement in MBO as a tool for effective
performance at LOPA Enugu
3)
To
find out how management by objective (MBO) could applied at LOPA energy Co. Ltd
to motivate the employee to work better.
1.4
RESEARCHER
QUESTIONS
Research questions
are question posed by the researcher answer to which would lead to the solution
of the problem
The research question are as follows
1)
Does
management by objective (MBO) improve or enhance the overall performance of the
company?
2)
To
what extent does management involvement in MBO as a tool for effectives performance
at LOPA energy?
3)
How
does management by objective (MBO) applied at LOPA energy Co Ltd motivate the
employees to work better.
1.5
RESEARCH
HYPOTHESIS
The hypothesis for the research work is
formulated after thorough and careful review of work that are
directly or indirectly related to the subject matter.
The hypothesis for this research work
are as follows
H0: Management by objective
(MBO) does not improve the overall
performance of the
company
H1: Management by objective
(MBO) improve the overall performance of t
he company
H0:
Management involvement in MBO does not work as a tool for effective performance
at LOPA Enugu
H1:
Management involvement in MBO work as a tool for effective performance at
LOPA Enugu
H0:
Management by objective (MBO) applied at LOPA energy does not motivate the
employees to work better
H1:
Management by objective (MBO) applied at LOPA energy motivate the employees to
work better
1.6
SINGIFICANCE
OF THE STUDY
Management of LOPA
energy in particular and other enterprise is Nigeria generally would find the
result of this research very rewarding and variable when applying management by
objective (MBO).
From this result they would know the
particular problem jeopardizing the correct application of management by
objective (MBO) and thereby take remedial action.
Consequently, the
acceptance of this study and adoption of the researcher’s recommendation could
assist management of LOPA energy other organization and public sectors in
making sound and strategic decision to improve employee performance and
productivity through careful result measurement appraisal rating and
commensurate reward system.
1.7
SCOPE
OF THE STUDY
The scope of this study is targeted at
evaluating the trend and problems of MBO as a management technique with
particular reference to LOPA energy situated at Emene in Enugu East L. G. A of
Enugu State.
It is hoped that the study would be
able to throw some light on the issue of an avenue for survival and
growth of the company. This study will help to know what is jeopardizing
the progress of the company
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