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Management Techniques: management by (Delegation, Objectives, exception, Decision, Systems)

Management Techniques: management by (Delegation, Objectives, exception, Decision, Systems)

The concept of leadership is as old as human history. No matter whether in a company, parties, the sports club or in the family. Without organization and leadership, there is chaos. No wonder that a number of management concepts have mushroomed to this day. One of the most famous macro concepts includes the so-called management-by techniques.
Basically, management-by techniques describe different procedures and behaviors that are used in a company to cope with management tasks . In the following, we will take a closer look at the five most important management-by techniques in order to see how these management techniques essentially differ.


• Management by Delegation (MbD)
• Management by Objectives (MbO)
• Management by Exception (MbE)
• Management by Decision Rules (MbDR)
• Management by Systems (MbS)


Management by delegation: managers delegate complete tasks and set specific goals.
Management by objectives: leaders and leaders work together to develop goals for specific tasks.
Management by exception: the leader only intervenes in exceptional cases and holds back in normal cases.
Management by Decision Rules: A set of rules prescribes what is to be done in certain situations according to the "if-then principle".
Management by Systems: Holistic method that uses various management by techniques with which all processes in a company can be optimized.

1- Management by Delegation (MbD)

It starts with management by delegation, which essentially means “leadership by delegating tasks”. A typical feature here is that the manager transfers tasks, competencies and responsibility for certain tasks completely to employees or groups of employees.
Caution! - This excludes both tasks with far-reaching consequences and management tasks that are part of the core competencies of the company management.
By delegating tasks and responsibility, the manager is relieved and gains additional leeway for other tasks. Its role in relation to the delegated tasks is limited to the control of the agreed objectives.
In order for management by delegation to work, a number of conditions must be met. MbD can only be implemented with suitable tasks that can also be handed over to employees. Routine tasks are ideal here. In addition, employees are required who are professionally and personally capable of taking on certain tasks independently.

Advantages of Management by Delegation (MbD)

• More employee motivation through the transfer of responsibility
• Inclusion of employees in corporate goals
• Stronger employee loyalty to the company
• Relief of the leaders, who can now take on other tasks
• Eliminate rigid hierarchy and decision-making powers

Disadvantages of Management by Delegation (MbD)

• Regular control of employees is necessary
• Control can have a demotivating effect on employees
• Transferring routine tasks can have a demotivating effect
• Risk of under-demanding as well as excessive demands
• Tasks may not be implemented as desired

2- Management by Objectives (MbO)

Management by objectives means something like "leadership through goals" and is very similar to management by delegation. However, MbO is essentially about the agreement of goals for specific tasks between leaders and those being led and not about the delegation of tasks. The task of managers is to monitor the achievement of goals.
A complete delegation of the tasks does not take place.


For MbO to work, individual goals not only have to match the strategic goals of the organization, but also have to be formulated according to the SMART scheme.
S = specific M = measurable A = Achievable R = realistic T = Time bound

In practice, managers and employees work out the specific goals together, so that the employee in question must also be measured against these goals in retrospect. Often the agreed goals serve as the basis for a bonus and are intended to promote work motivation. This management concept can be used flexibly at all levels of the company hierarchy.

Benefits of Management by Objectives (MbO)

• Integration of employees in goal setting processes
• Employee motivation through more responsibility and bonuses
• Stronger employee loyalty
• Linking the goals of the organization and individual goals
• Relief for executives

Disadvantages of Management by Objectives (MbO)

• Managers have to take on control tasks
• Increasing pressure to perform for employees through target setting
• Does not work without an incentive system
• There is a risk that employees will only focus on personal goals and lose sight of the bigger picture
• Focusing on goals increases the risk that qualitative aspects of the work will be neglected

3- Management by exception (MbE)

Management by exception means "lead according to the exception principle" and is closely related to MbD and MbO. It is characteristic of Management by Exception that the executives leave decisions and tasks in routine processes to the managed independently in a previously defined framework (see MbD).
Managers only intervene if unforeseen events occur or the agreed framework is exceeded.
This is the case, for example, with unexpectedly poor work results or with particularly important events.

Similar to management by objectives, goals, assessment criteria and success criteria play an important role. In combination with control and reporting systems, these serve to identify exceptional cases in which the leaders intervene. In order for this to work, however, the managers must transparently communicate goals, responsibilities and the tolerance framework for deviations. In practice, MbE is based on a 5-phase model.


1. Determination of goals and parameters for the achievement of the goals.
2. Define tolerance limits for deviations from the defined goals
3. Checking the target performance based on the actual deviations
4. Intervention by the manager if the tolerance range is exceeded.
5. Repeat steps 3 and 4 until the task has been completed.

Advantages of Management by Exception (MbE)

• Relief of the executives from routine tasks
• Less control effort than with other management by techniques
• Higher motivation of employees through independent work in their areas of competence

Disadvantages of Management by Exception (MbE)

• Employees can tend to mask poor results
• Usually employees are restricted to routine tasks
• Finding the right balance between intervention and personal responsibility is a challenge.
• Inadequate controls can lead to poor results and disadvantages for the company

4- Management by Decision Rules (MbDR)

The main distinguishing feature between Management by Decision Rules and other Management by Techniques is the clear decision-making set of rules. This set of rules contains clearly defined "if-then rules" that determine how employees should behave in certain situations. This in turn has the advantage that the leader does not have to intervene himself in most scenarios.
Since the set of rules cannot cover all possible cases, the MbDR concept is particularly suitable for routine tasks in which sudden and unexpected events are seldom to be expected. Therefore, the concept is usually not used on its own, but as a supplement to other management-by techniques .

Benefits of Management by Decision Rules (MbDR)

• Significant relief of the leaders, especially from routine tasks
• Management and control of employee behavior is simplified by a fixed set of rules
• Company goals and (routine) tasks can be coordinated very well with one another

Disadvantages of Management by Decision Rules (MbDR)

• Limitation of the management concept to routine tasks
• The set of rules cannot cover all possible scenarios
• Strong formalization and structuring of the work through simple rules
• Lack of motivation among employees, as personal responsibility is replaced by a rigid set of rules

5- Management by Systems (MbS)

Management by Systems is, so to speak, Management by Decision Rules on a very large scale.
This is a holistic approach that not only includes a set of rules for routine tasks, but a systematic approach.
In addition to rules based on the “if-then” pattern for routine tasks, this also includes higher-level management and control processes with procedural instructions.
The organization in control loops is typical, whereby the manager acts as a controller and is only supposed to intervene in the self-organizing units (see MbD) himself in exceptional cases (MbE). The focus is therefore on the management functions of organizing and realizing. In general, the MbS is currently (still) difficult to implement technically due to its complexity.

Advantages of Management-by Systems (MbS)

• Relief for executives, especially through routine tasks
• Optimization of work processes, especially in the administrative area
• Cost reduction, especially in the administrative context
• Clear rules and structures at all levels simplify communication

Disadvantages of Management by Systems (MbS)

• Higher level of bureaucracy
• Difficult implementation
• Lack of flexibility in exceptional situations or in innovation processes
• Demotivation of employees through hardly any personal responsibility and a rigid system of rules


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