IDEALLY, MANAGEMENT BY OBJECTIVES IS A SYSTEM THAT INTEGRATES THE COMPANY'S GOALS OF PROFIT AND GROWTH WITH THE MANAGER'S NEED TO CONTRIBUTE AND TO ENHANCE SELF-DEVELOPMENT. SOME PITFALLS CAN BE AVOIDED IF MANAGEMENT WATCHES THE WAY THE SYSTEM IS FUNCTIONING, IF THE SYSTEM IS KEPT FLEXIBLE, AND IF THE OBJECTIVES OF BOTH THE COMPANY AND ITS MANAGERS ARE TAKEN INTO ACCOUNT. THE TEXT SYSTEMATICALLY OUTLINES THE ESSENTIAL FEATURES AND BENEFITS OF MBO, INCLUDING CONCENTRATION ON IMPORTANT PROFIT-INFLUENCING TASKS AND PROBLEM IDENTIFICATION; PINPOINTS WAYS IN WHICH MBO SOMETIMES GOES WRONG; AND LOOKS AT THE PROBLEM OF DEVELOPING MANAGERS IN LINE WITH COMPANY OBJECTIVES FROM THE VIEWPOINT OF THE CHIEF EXECUTIVE, OF ONE OF THE MANAGERS, AND OF THE MANAGEMENT TEAM. SUGGESTIONS FOR MAKING A START INCLUDE SECURING THE SUPPORT OF THE CHIEF EXECUTIVE AND SENIOR COLLEAGUES, CAREFULLY STUDYING THE BUSINESS, AND TRAINING ONE OR MORE ADVISERS TO LAUNCH THE WORK. DETAILS OF SETTING OBJECTIVES, KEY RESULTS ANALYSIS, AND PERFORMANCE REVIEW ARE OUTLINED. SECTIONS ON MANAGEMENT TRAINING ANALYZE ON-THE-JOB TRAINING, IN-COMPANY AND OUTSIDE COURSES, AND EVALUATION. SUGGESTIONS FOR SUCCESSFUL SALARY AND SUCCESSION STRUCTURES ARE GIVEN, AND PLANNED MANAGEMENT CONTROL OF INFORMATION IS ADVOCATED. AN IMPROVEMENT ANALYSIS CHECKLIST, REFERENCES, AND A BIBLIOGRAPHY ARE INCLUDED. (AOP)