Agile Management by Objectives

Objectives & Goals
Management by Objectives

What is MBO

Management by Objectives (MBO) is a strategic approach to enhance the performance of an organization.


long-term (usually annual) definition of the company's objectives (mainly in a "top down" mode)
achievement of objectives: measured, evaluated and, in the best case, rewarded (Bonuses) on the basis of results at the end of the year.
Process / Method of MBO

Steps in the management by objectives process:


1. Goal definition:

  - What do I want to achieve, within how long?

2. Involvement of the team:

  - Which resources can/will I count on?

3. Assignment of roles and objectives:

  - What contribution do I expect from everyone?

4. Measurement in progress:

  - Where are we? - corrective actions

5. Final verification of results

  - Goal achieved?


Objectives must be S.M.A.R.T (Specific, Measurable, Achievable, Realistic, Timely)
Advantages and disadvantages of MBO

Advantages of MBO

Limitations of MBO

Improved Performance

Lack of Proper Objective/of an explicit team goal


No Role Ambiguity

‘SMART’ objectives are not necessarily agile objectives.

Maximum Utilization of Human Resources

Issues in Goal Setting

Career Development of the Employees

Coordination Problem Time Consuming


Result Based Performance Evaluation

(and not on some intangible characteristics)

Reward-Punishment Approach

(extrinsic purpose Vs intrinsic motivation)


Develops Organizational Problems



Sometimes Lack Appreciation


Agile Approach

What is the Agile Approach

Agile is an iterative approach to project management (originated in the software development industry) that focuses on flexibility, communication and segmentation.


There are many different application methodologies of the agile philosophy (Scrum is the most popular), each of it is unique in its specific approach. But they all share a common vision and a set of core values:


  • Four essential values of the agile methodology:
Individuals and interactions over processes and tools
Working software over comprehensive documentation
Customer collaboration over contract negotiation
Responding to change over following a plan
  • Five essential attributes:


Phases of Agile Process

short-term objectives
prognosis of project progress based on experience: giving way to constant revisions


This allows for a more continuous way of setting and reaching goals as well as being more efficient in responding to change if needs be.

Advantages and disadvantages of Agile

Advantages of Agile

Limitations of Agile

Regular adaptation to changing circumstances

Cost of Agile development methodology is slightly more as compared to other development methodology

Daily and close cooperation between business people and developers

The project can quickly go out off track if the project manager is not clear about requirements and what outcome he/she wants

Even late changes in requirements are welcomed

It is not useful for small development projects

Dividing into sprints gives the team the opportunity to focus on the individual stages and work faster


Flexibility in defining priority functions and setting goals


Agile (R)Evolution

Agile (R)Evolution



"Traditional” organizations: designed primarily for stability, involve a static, siloed, structural hierarchy.


Agile” organizations: designed for both stability and dynamism.
- network of teams within a people-centered culture
- rapid learning and fast decision cycles enabled by technology and guided by a powerful common purpose.
Why this methodology is so important today


Agile methodology overcomes the risk of spending a lot of time if there are any changes required.


It allows teams to work directly with clients, instead of working with other teams.


This provides a clear outcome with a focused goal and in an incremental way.
How to pull off an agile transformation

OKRs are the ideal approach for companies working with agile methodologies




Checklist for Agile Objectives

What is an agile objective?

  • An agile goal is a "higher purpose," which transcends the goals of all stakeholders. It is a goal for the entire system, not a goal just for the Product Owner, or the manager, or the CEO, or the shareholders;


  • Agile goals are not required to conform to a whole range of criteria, like specific, measurable, etc. A goal depends on its context. Sometimes it should be inspiring, sometimes it should be measurable;


  • An agile goal should not be connected to rewards or incentives. Extrinsic motivation distorts the system and causes non-linear consequences, which often defeat the purpose of the goal itself. Instead a goal should address people’s intrinsic desires
Checklist for Agile Objectives

 Is the goal specific and understandable enough so that people know what you mean?
 Is the goal manageable and measurable so that success can be determined?
 Is the goal memorable and reproducible so that people can easily communicate it to others?
 Is the goal attainable and realistic so that people have a chance of actually achieving it?
 Is the goal ambitious and stimulating enough so that it isn’t (too) easy to achieve?
 Is the goal actionable and assignable so that it can be turned into specific actions?
 Is the goal agreed-upon and committable so that people actually feel responsibility for it?
 Is the goal relevant and useful enough for people so that they really care about it?
 Is the goal time-bound and time-specific so that people know when to do it?
 Is the goal tangible and real so that people can see the effects of achieving it?
 Is the goal excitable and igniting so that it motivates people to do their best?
 Is the goal inspiring and visionary so that it helps people to see a bigger picture?
 Is the goal value-based and fundamental so that it builds on top of company values, team values, or personal values?
 Is the goal revisitable and assessable so that you can reassess its applicability later?
Summing up

Summing up