I am seeking clarification on performance appraisals, specifically those based on Management by Objectives (MBO) and Key Result Areas (KRAs). Could someone please explain the differences between a performance appraisal system based on MBO and one based on KRAs?
Thank you.
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Thank you.
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Management by Objectives (MBO) and Key Result Areas (KRAs) are two different approaches to performance appraisal.
1. MBO is a goal-oriented performance appraisal method where managers and employees set, plan, and monitor specific objectives within a certain timeframe. The objectives are aligned with the company's overall goals. The performance is then evaluated based on the achievement of these objectives. This method encourages self-management and self-motivation, as employees are actively involved in setting their goals.
2. On the other hand, KRAs are the critical areas of performance that define an individual's job role. They represent the specific tasks an employee is responsible for in their role. The performance is evaluated based on how effectively and efficiently these tasks are completed. KRAs are more task-oriented and focus on the key responsibilities of an employee's job role.
In essence, while MBO focuses on achieving specific objectives aligned with the company's goals, KRAs focus on the effective completion of key tasks associated with an individual's job role. Both methods have their own advantages and can be chosen based on the nature of the job role and the company's performance appraisal strategy.
From India, Gurugram
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891. MBO is a goal-oriented performance appraisal method where managers and employees set, plan, and monitor specific objectives within a certain timeframe. The objectives are aligned with the company's overall goals. The performance is then evaluated based on the achievement of these objectives. This method encourages self-management and self-motivation, as employees are actively involved in setting their goals.
2. On the other hand, KRAs are the critical areas of performance that define an individual's job role. They represent the specific tasks an employee is responsible for in their role. The performance is evaluated based on how effectively and efficiently these tasks are completed. KRAs are more task-oriented and focus on the key responsibilities of an employee's job role.
In essence, while MBO focuses on achieving specific objectives aligned with the company's goals, KRAs focus on the effective completion of key tasks associated with an individual's job role. Both methods have their own advantages and can be chosen based on the nature of the job role and the company's performance appraisal strategy.
From India, Gurugram
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Dear Madam,
1. Management of Objectives helps to establish / fix Goals Sheets for employees. Normally, Goals Sheets are prepared for the stipulated period (one year) as per the company policy to review the performance. The goals are derived on the basis of " SMART" principle. i.e. Specific, Measurable, Attainable, Realistic and Time bound. Once the goals sheet is finalized after discussion between manager and his team members, this document becomes the key document to review performance. Normally , employee does self assessment and finally manager puts his final ratings.
2. KRA's are supportive points bifurcated or further divided in sub points in order to achieve set goals. these bullet points help to decide path to achieve set goals.
Thanks
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1. Management of Objectives helps to establish / fix Goals Sheets for employees. Normally, Goals Sheets are prepared for the stipulated period (one year) as per the company policy to review the performance. The goals are derived on the basis of " SMART" principle. i.e. Specific, Measurable, Attainable, Realistic and Time bound. Once the goals sheet is finalized after discussion between manager and his team members, this document becomes the key document to review performance. Normally , employee does self assessment and finally manager puts his final ratings.
2. KRA's are supportive points bifurcated or further divided in sub points in order to achieve set goals. these bullet points help to decide path to achieve set goals.
Thanks
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Dear Parminder Kaur,
The comparision of KRA & MBO mentioned below to have a rough understanding.
Definition:
Broad, high-level responsibilities or domains within a job where results are expected.
A management system focused on setting specific, measurable, achievable, relevant, and time-bound goals for a period.
Purpose
KRA:To outline the scope of a job role and identify the key areas in which a person is accountable for delivering outcomes.
MBO:To improve organizational and individual performance by setting collaborative goals and monitoring progress.
Scope
MBO:Broader, describing the "what" of a role.
KRA: More specific, setting actionable targets and metrics to achieve within a KRA.
Nature
Often descriptive, detailing essential functions and areas of focus.
Action-oriented and quantitative, tied to measurable results.
Relationship to Goals
Defines the broad areas where specific goals will be set.
Employs specific, measurable goals within these defined KRAs to track progress and drive success.
Example
"Customer Service" or "Product Quality".
"Achieve a 95% customer satisfaction rating in Q3".
The KRA & MBO are not a homogeneous approach for industries & establishments. The nature of operation decides to adopt either one of the approach or both as applicable. I am free to measure by FPS or MKS but shoul have the genuinity.
From India, Mumbai
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The comparision of KRA & MBO mentioned below to have a rough understanding.
Definition:
Broad, high-level responsibilities or domains within a job where results are expected.
A management system focused on setting specific, measurable, achievable, relevant, and time-bound goals for a period.
Purpose
KRA:To outline the scope of a job role and identify the key areas in which a person is accountable for delivering outcomes.
MBO:To improve organizational and individual performance by setting collaborative goals and monitoring progress.
Scope
MBO:Broader, describing the "what" of a role.
KRA: More specific, setting actionable targets and metrics to achieve within a KRA.
Nature
Often descriptive, detailing essential functions and areas of focus.
Action-oriented and quantitative, tied to measurable results.
Relationship to Goals
Defines the broad areas where specific goals will be set.
Employs specific, measurable goals within these defined KRAs to track progress and drive success.
Example
"Customer Service" or "Product Quality".
"Achieve a 95% customer satisfaction rating in Q3".
The KRA & MBO are not a homogeneous approach for industries & establishments. The nature of operation decides to adopt either one of the approach or both as applicable. I am free to measure by FPS or MKS but shoul have the genuinity.
From India, Mumbai
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(Fact Checked)-Your explanation of MBO and KRA is spot on! You've clearly outlined the differences and purposes of each. Keep sharing your knowledge! (1 Acknowledge point)
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(Fact Checked)-Your explanation is accurate! MBO focuses on goal-setting while KRAs are the steps taken to achieve these goals. Keep up the good work! (1 Acknowledge point)