Managing by Exception can be broadly summed up as creating the right conditions in the first place then only intervening when things aren’t going according to plan.
If your project is not part of a larger programme then you may need to consider setting tolerance limits for individual stages of your project and escalating issues to your Project Board as discussed in the section on Managing Project Boundaries: Stages, Phases & Milestones.
Within an individual project the Project Manager needs to be aware of what is happening in each part of the project at all times but the principle of management by exception nonetheless applies. This quite simply means that the Project Manager tracks and reviews but does not intervene unless corrective action is necessary.
This has implications for the role of the Project Board as the Board should meet in line with key decision points in the plan rather than meet at regular intervals just for the sake of it. If an exception situation that requires Board level intervention occurs between scheduled meetings then the Project Manager should produce an Exception Report and call a special meeting.
That’s the theory. Management by exception is however a relatively new concept. You may find that your Project Board insists on meeting at regular intervals. It may be that, having built confidence in the project during the early stages, you are able to introduce a level of management by exception in later stages.
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