In PRINCE2, it is assumed that the people on the project board are senior people who have little time to spend on the day to day management of the project. The day to day management is the responsibility of the project manager. The project board therefore delegates day to day management for a stage to the project manager within agreed “tolerances” for the objectives of time, cost, risk and scope. Providing the project manager is confident that he/she can deliver the stage plan within these agreed tolerances then he/she can take corrective action to get things back on track if things are running late of going over budget.
If however, the project manager cannot deliver the stage plan within these agreed stage tolerances then this is known as an “exception” in PRINCE2 and this must be escalated to the project board for a decision. This therefore is a very efficient use of senior management time and means that the project board are only involved in taking decisions as and when the need arises. (They are of course still involved in taking the key “Go/No go” decisions at the end of each stage).