Conclusion

The preceding chapters acknowledged that there are various sources of managerial discretion. Several forms of managerial discretion have also been highlighted. At least conceptually managerial discretion can be eliminated completely if (a) every individual chosen to do a specific job is competent and motivated to deliver what is expected (purely psychologically or since compensation received is considered equitable and satisfactory), (b) there are enough controls at the higher level of management to ensure that the lower level group does not renege collectively even when there is coherence and synergy among them, (c) the above two features can be extended to all decisions relevant to the corporation, and (d) most importantly the subjective personal costs and objectives of everybody involved in the corporation can be completely articulated and taken care of through suitable compensations. We need to know the extent to which the maximum possible (conceptually) market value of the firm is not attained (this being the ultimate measure of managerial discretion) but we should also know the components of it to the last individual related to the organization and the reasons for such behavior. More recent developments in machine learning are making attempts to fold all the relevant features into their algorithms that aim to offer appropriate guidance to the management. Some limitations of these efforts have also been highlighted. In the final analysis, they may not have the flexibility of the human mind. The ultimate conceptualization of a perfect corporation is mostly a utopia.