Directed primarily toward those concerned with school administration, this guide describes a Management by Objectives (MBO) System and its application in a local school district. Three basic steps are outlined in the system approach: annual district-wide goals are set by the board of education in consultation with management personnel at all levels and representatives of staff, students, and community; the school district organizational chart lays out administrative staff responsibilities for achieving school district objectives; and goals and objectives are set for each school. The operation of this system in the New Rochelle, New York, school district is described in depth, including background planning, goals and objectives, a school profile, and community involvement. Other topics include measurability, benefits, and hiring, firing, and supervising practices in an MBO system. (DS)