What does management by exception refer to in the control process?

Management by exception is a control process that focuses on identifying and responding to significant deviations from predetermined standards or targets. This approach allows managers to prioritize their attention and resources on areas that require corrective actions, rather than micro-managing every aspect of performance. By concentrating on major discrepancies, managers can allocate their time and effort more effectively, ensuring that the most critical issues are addressed promptly.

This method is highly efficient, as it helps in minimizing unnecessary interventions in areas that are performing as expected. It promotes a sense of accountability and helps in fostering a culture of performance improvement, as employees are empowered to manage their routine tasks independently, while the management focuses on the exceptions that need attention.

In contrast to this approach, addressing all performance issues equally would overwhelm managers and dilute focus on the most pressing problems. Similarly, merely setting performance objectives or measuring team efficiency does not offer the same targeted response to deviations, which is central to the core concept of management by exception. This approach ultimately aids in better decision-making and enhances organizational effectiveness.