Question

The manager of the production department for Romulus Manufacturing has responsibility for all stages of the production process and does not have time to review all the operational details of his department. He has found it to be more productive to focus on the significant deviations from budget. This kind of management is called:
a. Management by exception.
b. Crisis management.
c. Controllable management.
d. Decentralized management.

Answer 1

Answer:

The correct answer is:

Management by exception. (a.)

Explanation:

Management by exception (MBE) is a style of business management, where the manager focuses his interests by identifying and handling business exceptions (cases that deviate from the normal expectations set by the project management method), usually by human intervention. This management is done by identifying, resolving and handling the business deviations by using advanced management staff skills and software tools. One major advantage of management by exception is that it brings to light business errors and oversights, ineffective strategies that needs to be improved and changes in competition and business opportunities, thereby, reducing managerial load and increase effective use of time on areas of most impact.

Management by exception can be carried out actively or passively in active MBE, the leader assists the subordinates proactively with  issues to prevent mistakes, while in passive MBE, the leader only intervenes after the mistakes have been made, leading to a result that deviates from the norm, rather than during the process.

Advantages of MBE

• time and energy are utilized efficiently
• problematic issues are identified rapidly
• workload reduces on the manager
• employees have more responsibilities, hence increasing their motivation.

Disadvantaiges of MBE

• mistakes can be so large and complicated that it will end up being time consuming and expensive to resolve
• only managers have the power over really important decisions
• it takes time to pass the issues to the manager

Answer 2

Answer:

a. Management by exception.

Explanation:

Management by exception is the style of management to operate in normal cycle of business.

Crisis management deals with operations which are not normal cycle of business.

Controllable management is the cost that the manager has the power to control.

Decentralized management is the style of management in which lower managers have power to make decisions