Management by exception is the practice of examining the financial and

Management by Exception (MBE) Management by exception is the practice of examining the financial and operational results of a business, and only bringing issues to the attention of management if results represent substantial differences from the budgeted or expected amount.Management by exception principle asserts that every subordinate should be authorized to manage or perform his routine jobs without any intervention from his superior manager.Definition of MBE

Acc. To Lister Bitter “Management by exception is an information and control technique that provides management with signals that tell when a condition or operation is within its prescribed standard and when it is not.”

Acc. To Thomas Divining “Exception principle of management states that only significant deviations from policies and procedures should be brought to the attention of managers.” Characteristics of Management by Exception

Following are the main characteristics of management by exception:

• Management by exception is a system under which only those matters and

problems are brought to the notice of high level managers which are of great importance.

• Matters of routine nature or problems related to day to day working are

resolved by subordinates on their own.

• In this system, there is stress on decentralization of authority.
• High management officials have competed trust on their subordinates and

they delegate authority to them.

• This management technique lays stress on improving skills and working

capabilities of the subordinates.

• High level managers concentrate their attention only on important matters in

system f management by exceptions.

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