Peter Drucker believed that the survival of the company was at risk when managers emphasized only the profit objective because this single objective emphasis encourage managers to take action that will make money today with little regard for how a profit will be made tomorrow.  

8 key areas in which managers should set management system objectives are:
  1. MARKET STANDING: Management should set objectives indicating where it would like to be in relation to its competitors.                                                                                                         
  2. INNOVATION: Management should set objectives outlining its commitment to the development of new methods of operation.                                                                                             
  3. PRODUCTIVITY: Management should set objectives outlining the target levels of production.                                                                                                                                                     
  4. PHYSICAL & FINANCIAL RESOURCES: Management should set objectives regarding the use, acquisition, and maintenance of capital and monetary resources.                                              
  5. PROFITABILITY: Management should set objectives that specify the profit the company would like to generate.                                                                                                                               
  6. MANAGERIAL PERFORMANCE & DEVELOPMENT: Management should set objectives that specify rates of worker productivity as well as desirable attitudes for workers to possess.                                                                                                                                                  
  7. WORKER PERFORMANCE & ATTITUDE: Management should set objectives that specify rates of worker productivity as well as desirable attitudes for workers to possess.                                        
  8. PUBLIC RESPONSIBILITY: Management should set objectives that indicate the company’s responsibilities to its customers and society and the extent to which the company intends to live up to those responsibilities.

4 thoughts on “PETER DRUCKER on Setting Management Objectives

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