 Authority: Is the right to give orders and the

power to exact obedience.

 Rightful legal power to request subordinates
to do certain things or to retain from doing
so, and if he does not follow these
instructions the manager is in a position ,if
need be, to take disciplinary action, even to
dismiss the subordinate.
 Power is the ability of individuals or groups
to induce or influence the beliefs or actions
of other persons or groups.
 Five types of power identified John
French and Betram Raven
 Legitimate power of primary concern. It
normally arises from position in hierarchy
of the organization
 Expert power come from the expertness
of a person or a group. Physicians,
lawyers, university professor have
considerable influence on others because
they are respected from their special
knowledge.
 Referent power personal power that someone
based on identification, imitation, loyalty, or
charisma.
 Example: Martin Luther king by the force of his
personality, his ideas, and ability to preach, he
strongly influenced the behavior of many
people.
 Reward power is the power to give or withhold
rewards, such as salary increases, bonuses,
promotion ,praise, recognition, and interesting
job assignments.
 Example: University professors have
considerable reward power ;they can
grant or withhold high grades.
 Coercive power to force compliance
means of psychological , emotional , or
physical threat coercion is limited in most
organizations.
 Responsibility: It means
obligation,liability,or activity or
accountability.
 According to Koontz: It may be defined as
the obligation of a subordinate, to whom a
superior has assigned a task, to perform the
service required.
 Line functions are those that have direct impact
on the accomplishment of the objectives of the
enterprise.
 Functional authority is the right which is
delegated to an individual or a department to
control specified processes, practices, policies or
other matters relating to activities undertaken by
persons in other departments.
 Staff functions are those that help the line
persons work most effectively in accomplishing
the objectives.
 Example: Production and sales are line
functions.
 Purchasing, accounting ,personnel, plant
maintenance and quality control are staff
functions.
 Line executives have direct control over the
subordinates under them.
 Staff executives have no such authority.
 They are meant to aid and advise the line
managers at the same level.
 The clearer the line of authority from the
management position in an enterprise to
every subordinate position ,the clearer will
be the responsibility for decision making and
the more effective will be organization
communication.
 Nature of staff relationship is advisory .
 Their role is to investigate, research, and
give advice to line managers.
 Line and staff are characterized by
relationships and not by departmental
activities.
 Where highly specialized knowledge is
required the staffs are much helpful.
 Specialists are allowed the time to think, to
gather data, and to analyze whereas their
superiors busy managing operations, cannot
do so.
 Staff help line managers to be effective.
 Training of young staff executives
 Danger of undermining line authority.
 Lack of staff responsibility
 Thinking in a vacuum
Because staff people do not implement what
they recommend, it is possible that staff may
think in a vacuum.
 Managerial problems
Too much staff activity may complicate a
line executives job of leadership and control.
 Staff managers may sometime interfere in
the affairs of the line managers.
 Staffs are specialists in their area and they
are not well versed with the practical
problems of the organization.
 Line managers sometimes do not like to
share with staff officers the credit of
achievements.
 Ambiguity about each one’s roles
 Decentralization is the tendency to disperse
decision making authority in an organized
structure.
 It is a fundamental aspect of delegation; to
the extent the authority is not delegated, it
is centralized.
 It requires careful selection of which
decisions to push down into the structure
and which to hold near the top, specific
policy making to guide the decision making.
 Dispersion of customers and dispersion of
suppliers.
 Homogeneity of the product line.
 Volatility of the competititive
environment.
 The company’s size and attitude toward
cost control.
 Desire for uniformity of policy,
management philosophy.
1. Relieves top management of the burden
of decision making
2. Encourages decision making and
assumption of authority and
responsibility
3. Gives manager more freedom and
independence in decision making
4. Promotes establishment and use of broad
controls which may increase motivation
5. Makes comparison of performance of different
organizational units possible
6. Facilitates setting up of profit centers
7. Facilitates product diversifications
8. Promotes development of general managers
9.Aids in adaptation to a fast changing environment
LIMITATIONS OF DECENTRALIZATION:
1. limited by the availability of qualified managers
2. Involves considerable expense for training
managers
1. Makes it more difficult to have a uniform policy
2. Increases complexity of coordination of
decentralized organizational units
3. Result in loss of some control by upper level
managers
4. Limited by inadequate control techniques
5. Constrained by inadequate planning and
control systems
6. Limited by external forces
 Includes withholding the authority by few
persons at central points.
 Definition by Louis Allen : centralization is
the systematic and consistent reservation of
authority at central points in the
organization.
Types:
 Centralization of performance
 Departmental centralization
 Centralization as an aspect of management
1. Top management can take vital decisions
affecting the entire organizations
2. Having a uniform policy and coordination
of all activities are possible
3. High-level people in the organization can
take more effective and intelligent
decisions
4. Centralization offers a more flexible
base for the organizational structure
5. Crises and emergency situations can be
secured
1. Duplication of effort can be avoided
2. Control and communication becomes easier.
3. LIMITATIONS: Decisions are not taken by the
people who face situations and problems in
their area.
4. Lower and middle level management will not
have interest and initiative in the job.
5. Top management unnecessarily has to waste a
lot of time and energy on unimportant and
routine matters.
6. It hampers effective communication
Authority:
According to HENRY FAYOL-It is the right to
give orders and exact obedience.
Delegation:
The process involves the determination of results
expected, the assignment of tasks, the
delegation of authority for accomplishment of
these tasks, and the exaction of responsibility
for their accomplishment.
1.Delegation to go by results expected
Before assigning duties and delegating the
authority to his subordinates, the manager
should be clear in his mind as to what be expects
from them.
2. Responsibility is Absolute
 Manager can delegate only authority, not
responsibility.
 The ultimate responsibility for the performance
of duties and exercise of delegated authority
remains with him.
3.Select appropriate subordinate for
delegation
4. Authority to match Responsibility and
Vice Versa
Delegation can be meaningful only when it
enables the subordinates to discharge his duties
effectively and efficiently.
 Just as an ill- equipped soldier can’t fight a
battle successfully, an inadequate authorized
subordinate cant succeed in accomplishing the
assigned task.
5. Ensure unity of Command
A subordinate should be commanded by one
superior only.
6. Limits to authority to be Well- defined
 A manager can’t properly delegate
authority, unless he fully knows what his
own authority is.
 There should be written manuals and
orders to indicate the limits of authority
and area of operations of each manager.
7. Help the Subordinate
The executive must watch the subordinate
not as a policeman, but as a friend or
helper.
8. Reward effective delegation
Effective delegation and successful
assumption of authority must be
rewarded.
 General or specific delegation: Each
subordinate is granted general authority to
perform the various managerial functions of
planning, organizing, direction and control.
 Written delegation is made by written orders,
instructions etc, and unwritten delegation is
based on custom, convention or usage.
 Formal delegation: Example: the sales manager
is assigned the responsibility and the
accompanying authority to maintain and
promote sales.
 Informal delegation: occurs when
employees perform certain duties not
because they feel that by doing so they
can perform their delegated tasks better
and in time.
 Downward, upward and sideward
delegation:
Occurs where a superior delegates duties
and authority to his immediate
subordinates.
1. The determination of results expected
from persons in a position.
Before assigning duties and delegating
the authority the manager should be
clear as to what he expects from them.
2.The assignment of tasks to persons in a
position.
The activities assigned should be stated
in operational terms so the subordinate
knows exactly what action must be
taken to perform the assigned duties.
3.The delegation of authority for
accomplishing these tasks.
Subordinate must be given the right and
power within the organization to
accomplish the duties assigned
4.Creating the obligation for the
subordinate to perform the duties
assigned.
The subordinate must be aware of the
responsibility to complete the duties assigned
and must accept the responsibility.
1. None better than I
2. A sheep in lions clothing
3. I will be exposed
4. The company can’t do without me
5. I am the master
6. Why take the risk
7. None of the subordinates is capable
8. What if he proves better than me
 Delegation is the process of assigning tasks and
granting sufficient authority for their
accomplishment.
 Decentralization is the delegation of authority
across numerous units, departments and levels of
management.
 Delegation is the process where as decentralization
is the result of planned delegation.
 Delegation is necessary for the efficient and
effective functioning of an organization.
 Decentralization is optional to the top
management.