Introduction

In the field of management, two commonly used approaches are critical point control and management by exception. Both approaches aim to ensure effective control and management of organizational processes, but they differ in their focus and application. This article will provide a detailed explanation of the differences between critical point control and management by exception.

Critical Point Control

Critical point control involves closely monitoring and controlling specific critical points or key performance indicators (KPIs) within an organization. These critical points are predetermined and are considered crucial for the success of the organization. The focus is on identifying and addressing potential issues before they become major problems. Key features of critical point control include:

1. Identification of critical points: The first step in critical point control is to identify the key areas or KPIs that have a significant impact on the overall performance of the organization. These could include financial metrics, production targets, customer satisfaction levels, or any other relevant factors.

2. Continuous monitoring: Once the critical points are identified, they are closely monitored on an ongoing basis. This involves collecting relevant data, analyzing it, and comparing it against predetermined benchmarks or targets.

3. Timely intervention: In critical point control, the focus is on taking immediate action when any deviations or issues are detected. This could involve making adjustments to processes, reallocating resources, or implementing corrective measures to bring the situation back on track.

4. Proactive approach: Critical point control is a proactive approach that aims to prevent problems from occurring or escalating. By closely monitoring the critical points, organizations can address issues in their early stages, minimizing the impact on overall performance.

Management by Exception

Management by exception, on the other hand, involves focusing on significant deviations or exceptions from the norm rather than monitoring every aspect of the organization. This approach assumes that most processes will run smoothly within acceptable parameters, and attention should be given to situations that fall outside these parameters. Key features of management by exception include:

1. Establishing norms: The first step in management by exception is to establish normal or expected ranges for various processes or KPIs. These ranges are typically based on historical data, industry standards, or benchmarks.

2. Monitoring for exceptions: Instead of continuously monitoring every aspect, management by exception involves periodically reviewing data and performance indicators to identify any significant deviations from the established norms.

3. Focus on significant deviations: In this approach, the focus is on identifying and addressing significant exceptions that have the potential to impact the overall performance or goals of the organization. Minor deviations that do not significantly affect the outcome are not given excessive attention.

4. Intervening when necessary: When exceptions are identified, management by exception requires management to intervene and take appropriate action. This could involve investigating the cause of the exception, making adjustments to processes, or implementing corrective measures to bring the situation back within acceptable parameters.

Differences between Critical Point Control and Management by Exception

While both critical point control and management by exception aim to ensure effective control and management, there are several key differences between the two approaches:

1. Focus: Critical point control focuses on monitoring and controlling specific critical points or KPIs, while management by exception focuses on identifying and addressing significant exceptions or deviations from established norms.