Final answer:
Departmental sub-optimization occurs when a c) department's goals take precedence over the organization's overall goals, leading to goal displacement and possible inefficiencies.
Step-by-step explanation:
Departmental sub-optimization occurs when a department within an organization begins to prioritize its own goals over the overall organizational goals.
This situation arises due to inconsistencies between the official goals (what the organization publicly states as its aims and objectives) and operative goals (the actual goals that are pursued by different departments within the organization).
When sub-optimization occurs, it often leads to goal displacement, which is a scenario in which the real goals of a department diverge from the stated goals of the entire organization.
This can cause problems as each department may work towards outcomes that do not necessarily contribute to or may even conflict with the broader objectives of the company, potentially leading to inefficiencies and a reduction in overall performance.
To answer the provided multiple-choice question, option c) 'It occurs when a department prioritizes its own goals at the expense of the overall organizational goals.'
is the correct definition of departmental sub-optimization in the context of goal displacement caused by inconsistencies between official and operative goals.