Question

How can a regional manager of a retail chain enhance operational efficiency and maximise profits by analysing deviations in sales performance among different stores? Some outlets consistently exceed sales targets, while others struggle to meet their goals. To address these disparities, the regional manager aims to implement two management techniques for analysing deviations. Explore these two techniques in detail.

Answer 1

1. Management by Exception: (MBE) is a managerial approach that focuses on identifying and addressing significant deviations or exceptions from standard performance. Instead of monitoring all stores equally, the regional manager prioritizes attention on exceptional cases that deviate significantly from established benchmarks.

2. Critical Point Control: It involves closely monitoring specific key performance indicators (KPIs) or KRA's that have a significant impact on overall sales performance. Managers use this technique to identify critical points where immediate action is necessary to prevent potential crises or losses.