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Management by objective (MBOs):


The theory of management by objective is very popular among the managers of the business organization. The theory sets goals to improve the performance of the firms by clearly identifying and defining the goals agreed by the employees and the top management of the business organization (Smith, 2008; Manning, 2017). The theory of the management by objective believes that the organizational performance is closely linked with the mutual acceptance of the goal setting and acceptance by the management and the employees itself. The constructs of Management by objectives (MBOs) are detailed as under:

Goals specificity:
The 1st step in the goal-setting theory approach in the MBOs is specifically setting the goals with a clear line of direction of improving the organizational performance. The theory focuses that the goal set by the employees and management must be very specific.
Participative decision making:
The 2nd step in the goal-setting to improve the performance of the organization stresses the participative decision-making style. The theory explains that the goal-setting of the firm to improve its performance shall be made in the participative style. This participative style of decision making agrees both the management and the employees to work for a unified goal and in the same direction.

Monitor/review progress:
The 3rd step of the MBOs monitors and reviews the progress of the business organization in terms of the progress. The progress of the set goals is assessed periodically and possible improvement are added and communicated among the employees and management.
Performance feedback:
The 4th and the last step of MBOs is related to the performance feedback of the set goals to both the management and the employees of the organization to seek corrective measure and setting the future goals.
Thus, the management by objective is basically a win-win approach to the goal setting, performance, and achievement in the organizations. This participative style is applied assuming that the employees are responsible and work for the organizational benefit.

Contingency Factors:
The contingency factor approach believes that the things happening in the organizations are not predictable accurately rather they can be estimated and the decisions to achieve the goals. The setting of the goals and the corrective actions taken are dependent upon the prevailing situations and availability of resources. The research studies argued that the business organization must keep the risk factor margins in the goal setting and planning of the organization. The research empirically found that the firms with contingent factors likely to achieve the goals successfully compared to the firms following the mechanistic structure (Montagna, 2016; Lam and Siwingwa, 2017; Omotosho and Anyigba, 2019).

Common contingency plans:
The common contingency plans of the firms include temporary work activities that include meeting the staffing shortfall by pooling a temporary workforce, on the job training programs to work for professional development and dealing with the employee turnover issues.
Diversity revenues streams:
The diversity revenue streams include the possible measures of risk to be taken to deal with the financial risks. This is normally addressed by forming portfolios. The portfolios formulation is the result of the risk management and considering the contingent factors which are not removable but can be mitigated
.
Conclusion:
The goal-setting and the generic planning framework is the key activity that every organization conducts before carrying out the business operations. In this research study, the Miles and Vergen landmark of study that discusses the three best conditions that satisfy the goal setting. The Miles and Vergen concluded that the features including the SMART goals and values lead to improve the performance of the business organization. The analysis further revealed that in addition to the SMART goals the formulation of the goals must be positively established. The study also discussed the four steps of the management by objective which found that the goals and objectives must be agreed by the employees and management with mutual consent to improve the performance of the organization. The goal-setting shall be in participative style and performance shall be monitored and communicated periodically in the organization. Finally, the contingency factors theory believes that the things are not accurately predictable in the organizations; therefore, the contingent approach to risk management may result in achieving the goal.
References:

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