General Studies · Organizational Behavior
Which organisational barrier to goal achievement most directly exemplifies the principal-agent problem in management theory — where individual incentive structures diverge from organisational objectives?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Misdirection of effort by superiors, because managers focus on pleasing leadership rather than achieving outcomes
- 2Misdirection by compensation systems, because individual rewards tied to personal metrics incentivise behaviour that maximises personal gain at the expense of broader organisational goals✓
- 3Hierarchical management structures, because each level develops isolated sub-objectives
- 4Specialisation of work, because narrow expertise leads to functional myopia
Correct answer
Misdirection by compensation systems, because individual rewards tied to personal metrics incentivise behaviour that maximises personal gain at the expense of broader organisational goals
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