MBOMBO (Management by Objectives)

Learn in the textbookHuman Resource Management and Ways of Working

DefinitionMBO (Management by Objectives) is a management method in which employees set their own objectives for a period after discussing them with their manager, and are evaluated by their degree of achievement.

ExplanationBecause employees take part in setting their objectives instead of having them assigned from above, they find it easier to accept and commit to them. Individual objectives are set to connect with department and company goals, and the results are reviewed at period end to shape the next objectives.

AnalogyLike choosing your own destination and schedule before a trip, then checking afterward whether you covered everything as planned.

Memory hookManagement by Objectives means managing "by objectives". The idea was put forward by the management thinker Peter Drucker.

Learn in the textbookM&A and Corporate Restructuring

DefinitionAn MBO (Management Buyout) is a buyout in which a company's management buys most of its shares and takes control of the company themselves.

ExplanationWhat sets it apart is that the buyer is not an outside company but the people already running the business. It is used to gain independence from a parent company, or to delist so the business can be run without chasing short-term share prices. Management's own money is often not enough, so funds may be raised from banks or investment funds.

AnalogyLike a hired store manager buying the shop from the owner and carrying on running it as their own.

Memory hookBuyout means buying something outright. The leading M is the buyer's name tag: Management.