Subject: Human Resource Management

Topic: Authority, Delegation, Centralisation,

Decentralisation
i. Definitions of Authority

1.Institutionalized and legal power inherent in a particular job, function, or position

that is meant to enable its holder to successfully carry out his or her responsibilities.

2.Power that is delegated formally. It includes a right to command a situation,

commit resources, give orders and expect them to be obeyed, it is always
accompanied by an equal responsibility for one's actions or a failure to act.

3.An agency or body created by a government to perform a specific function, such

as environment management, power generation, or tax collection.

ii. Delegation of Authority

Delegation is the assignment of authority and responsibility to another person to

carry out specific activities. Delegation is normally from a manager to a
subordinate. However the person who delegated the work remains accountable for
the outcome of the delegate work. It allows a subordinate to make decisions, i.e. it
is a shift of decision-making authority from one organizational level to a lower one.

iii. Steps for effective Delegation of Authority.

The process of delegation has to go through the following steps:

Step 1: Assignment of responsibilities

This is the most crucial step that trigger delegation. In this step the superior
authority list out the responsibilities to be assigned to the subordinate by answering
the questions with reliable reasons:

What to delegate?

When to delegate?

Whom to delegate? and

How to delegate?

Step 2: Granting of Authority

Mere assigning of responsibilities alone cannot ensure execution of such
responsibilities by the subordinate. For smooth execution of the assigned

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responsibilities, the subordinate would require authority. Therefore assigning of
responsibility and granting of authority should go together to the subordinate.

Step 3: Ensuring of Accountability

Delegation of Authority does not become complete with assigning of responsibilities

and granting of authority. The superior is required to build accountability on the part
of the subordinate to ensure that assigned responsibilities are carried out and
delegated authority is used judiciously. This part should be taken care of in the M&E
plan and also through regular and effective performance appraisal.

iv. Obstacles to Delegation of Authority

Even though delegation is vital for the efficient functioning of the organization, in practice there are
several factors which prevent effective delegation. These problems in delegation may be classified into
three categories.
Obstacles due to superiors: Managers are often reluctant to delegate authority due o the following
reasons

1. Some managers are autocratic and they think that delegation will led to reduction of their influence in
the organization.

2. Some managers think that no one can do the job as well as they can do. They think themselves as the
most experienced ones.

3. An incompetent manager doesnt want to delegate his authority for fear of being exposed.

4. Few mangers are inclined to accept the risk of wrong decisions which the subordinates might take.
Therefore, they do not delegate authority and take all the decisions themselves. They are unwilling to
calculate the risk.

5. Managers may not delegate authority because he feels that his subordinates are not capable and
reliable. He lacks confidence in his subordinates.

6. A manager will hesitate to delegate authority if he has no proper means of control to ensure that the
authority is being properly used by his subordinates

Obstacles due to subordinates: The subordinates may not like to accept the delegated authority due to
the following reasons

1. Subordinate may be reluctant to accept delegation when they lack self confidence

2. Some subordinates may have the attitude of spoon feeding and depend excessively on the loss for all
decisions

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3. When the subordinates are already overburdened with duties, they do not like additional responsibility
through delegation
4. They avoid delegation when adequate information, working facilities and resources are not available.

5. They reject delegation of authority if no incentives are available to them.

Obstacles due to organizing weakness: Sometimes delegation may be hampered due to weakness in the
organization structure. Some of the weaknesses are as follows

1. inadequate planning
2. splintered authority
3. lack of unity of command
4. absence of effective control techniques
5. non availability of competent managers
6. unclear authority relationship
7. Environment of internal distrust.

v. Methods of Eliminating Obstacles in Delegation of Authority

Despite several advantages of delegation, managers can be reluctant to delegate

authority. Managers often have a number of excuses for not delegating: I can do it
better myself; My employees just arent capable enough; It takes too much time
to explain what I want to be done. The real reason may be the manager is simply
too disorganized or inflexible to delegate work effectively.

Guidelines for effective Delegation:

Prerequisites:

1. The most basic prerequisite to effective delegation remains the managers

willingness to give employees freedom to accomplish delegated tasks.
2. A second prerequisite for delegation is open communication between
managers and employees.
3. The third prerequisite for delegation is the managers ability to analyze such
factors as the organizations goals, the tasks requirements and the
employees capabilities.

Tasks of effective Delegation:

1. Create a plan. Analyze repetitive tasks. Decide which tasks can be delegated.
Decide what work belongs to subordinates and what role you need to play in
order to ensure their success. Create a responsibility matrix to reinforce roles.
Accept that it may take your subordinate longer to complete a task at first.
Establish a long-term plan that allows subordinates to develop speed and
accuracy.
2. Ask subordinates for input. This encourages process improvement. Dont
assume that problems can be solved in a single way. By conducting a root

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 cause analysis, you may find additional considerations and alternative
solutions.

3. Decide who should get the assignment. Assign tasks to people who can do
the work. Match tasks with each employees capabilities and developmental
plan. Encourage people to take on stretch assignments and provide
remediation as necessary. Be sure to explain why you assign tasks to certain
individuals.

4. Provide sufficient resources for carrying out the delegated task

5. Delegate the assignment: In delegating the assignment, effective managers
provide all relevant information on the task.

6. Foster a culture of innovation and creativity. Encourage employees to propose

solutions to problems and empower them to solve issues on their own,
depending on complexity, cost and business impact.

7. Provide training on communication and decision making skills. Improving

interpersonal skills enables your employees to function better as a team.
Create checklists that help employees troubleshoot problems and correct
situations on their own without requiring management intervention.

8. Establish a feedback system.

Authority, Accountability, and Responsibility

Authority is Institutionalized and legal power inherent in a particular job, function,

or position that is meant to enable its holder to successfully carry out his or
her responsibilities.

Authority is also defined as Power that is delegated formally. It includes a right to

command a situation, commit resources, give orders and expect them to be
obeyed. It is always accompanied by an equal responsibility for one's actions or
a failure to act.

Responsibility is A duty or obligation to satisfactorily perform or complete

a task (assigned by someone, or created by one's own promise or circumstances)
that one must fulfill, and which has a consequent penalty for failure.

Accountability is The obligation of an individual or organization to account for

its activities, accept responsibility for them, and to disclose the results in
a transparent manner. It also includes the responsibility for money or other
entrusted property.

Clearly, authority and responsibility have accountability in common. Without

accountability authority can be abused and responsibility neglected.

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 Authority- Centralization and Decentralization (Span
of Control)
Centralization of authority means the power of planning and decision making are
exclusively in the hands of top management while in case of Decentralization, the
powers for the same has been disseminated by the top management to middle or
low level management.

Comparison Chart
Basis for Centralization Decentralization
Comparison
Meaning The retention of powers and The dissemination of authority,
authority with respect to responsibility and accountability
planning and decisions, with to the various management
the top management, is levels, is known as
known as Centralization. Decentralization.
Communication Vertical Open and Free
Flow
Decision Making Slow Comparatively faster
Advantage Proper coordination and Sharing of burden and
Leadership responsibility
Power of Lies with the top Multiple persons have the power
decision making management. of decision making.
Reasons Inadequate control over the Considerable control over the
organization organization
Best suited for Small sized organization Large sized organization

# Determinants of Effective Decentralization

Size of Organization: - Decentralization depends upon size of organization. Larger the size of
organization more the number of decision making areas will be there. So it will not be possible for single
head to make all the decisions alone. Also the decision making process will be slow as communication
process will be very long. Therefore need of decentralization would be more important.

History of organization:- Decentralization depends upon how the organization developed over the
period of time. Normally those organizations which expand under the direction of owner-founder show
resistance to decentralization.

Management philosophy: The character of top leader of organization influence the extent of authority is
centralized or decentralized.

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Availability of mangers: - The shortage of quality manager also influences the extent of authority to be
decentralized. If good managers are available then there is more possibility of decentralization of work.

Costliness of decision: - The costliness of decisions in most important factor that effect the
decentralization process. Decisions involving heavy costs or investment will be with top management like
decision making for purchasing capital goods, land or machinery will be with top management and
purchase of normal routine goods like daily stationary furniture will be made by department.

Rate of change in organization: - The rate of change in organization also affects the decentralization
decision. If the organization is fast developing and it is facing problems of expansion there is more
chances of decentralization of authority for reducing burden from top management.

Nature of activities: - The nature f operation s also determine the extent of decentralization i.e. whether
the operation of organization are concentrated at one place or region or dispersed over different areas. If
activities are dispersed in different territories then decentralization is must.