The principles of management by exception are explained as follows:
A systematic approach: The term systematic approach means that there should be clear and achievable standards to measure the deviations. All must adequately follow the organizational policies.
Self-control: Under this, the managers and subordinates at every level must establish a control system on their own. They must control all the activities performed by the staff under them.
Knowledge of exceptions: There should be a clear definition of the exceptional areas of the organizations to be controlled by the management. Any unimportant issue must not be included in the exceptional items.
Delegation of authority: The organization must follow the principle of delegation of authority. The management at lower level must be granted authority to make decisions on a lower level so that management can concentrate on exceptional items.
Invite co-partnership: Co-partnership means that all the managers and workers should work together to achieve the organizational goals and objectives.
Develop subordinates: The subordinates must be provided with training to handle all the issues under them. Their development should be made for better results.
Advantages, disadvantages and application of management by exception
Advantages of management by exception:
Following the principle of management by exception saves a lot of time and efforts of the management.
The management can be made aware of all the important issues of the organization.
The management needs to make decisions on fewer issues, which increases the quality of decisions taken.
All the possible opportunities can be known by following the technique of management by exception.
It identifies the cause of negative results of the organization that management can improve in the future.
Disadvantages of management by exception:
Following management by exception increases the workload of subordinates.
It is difficult to differentiate between the exceptional and non-exceptional areas of the organization.
It requires continuous observing and reporting to the management.
There can be a deviation due to human behavior. Such deviation is difficult to identify and correct.
Applications of management by exception:
Management by exception is applied in large organizations where the delegation of authority is possible.
Management by exception is applied for identifying the reason for the deviation of performance from the set standards.
The technique of management by exception is useful for the management in taking decisions for long term survival and future growth of the organization.
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