1. Authority

In context of a business organization, authority can be defined as the power and right of a person to use and allocate the resources efficiently, to take decisions and to give orders so as to achieve the organizational objectives. Authority must be well- defined. All people who have the authority should know what is the scope of their authority is and they shouldn’t miss utilize it. Authority is the right to give commands, orders and get the things done. The top level management has greatest authority.

Authority always flows from top to bottom. It explains how a superior gets work done from his subordinate by clearly explaining what is expected of him and how he should go about it. Authority should be accompanied with an equal amount of responsibility.

Delegating the authority to someone else doesn’t imply escaping from accountability. Accountability still rest with the person having the utmost authority.

2. Responsibility

It is the duty of the person to complete the task assigned to him. A person who is given the responsibility should ensure that he accomplishes the tasks assigned to him. If the tasks for which he was held responsible are not completed, then he should not give explanations or excuses. Responsibility without adequate authority leads to discontent and dissatisfaction among the person.

Responsibility flows from bottom to top. The middle level and lower level management holds more responsibility. The person held responsible for a job is answerable for it. If he performs the tasks assigned as expected, he is bound for praises. While if he doesn’t accomplish tasks assigned as expected, then also he is answerable for that.

3. Accountability

It means giving explanations for any variance in the actual performance from the expectations set. Accountability can not be delegated. For example, if ‘A’ is given a task with sufficient authority, and ‘A’ delegates this task to B and asks him to ensure that task is done well, responsibility rest with ‘B’, but accountability still rest with ‘A’. The top level management is most accountable. Being accountable means being innovative as the person will think beyond his scope of job. Accountability, in short, means being answerable for the end result. Accountability can’t be escaped. It arises from responsibility.

For achieving delegation, a manager has to work in a system and has to perform following steps: –

• Assignment of tasks and duties

• Granting of authority

• Creating responsibility and accountability

Delegation of authority is the base of superior- subordinate relationship, it involves following steps:-

(i) Assignment of Duties:

The delegator first tries to define the task and duties to the subordinate. He also has to define the result expected from the subordinates. Clarity of duty as well as result expected has to be the first step in delegation.

(ii) Granting of authority:

Subdivision of authority takes place when a superior divides and shares his authority with the subordinate. It is for this reason, every subordinate should be given enough independence to carry the task given to him by his superiors. The managers at all levels delegate authority and power which is attached to their job positions. The subdivision of powers is very important to get effective results.

(iii) Creating Responsibility and Accountability:

The delegation process does not end once powers are granted to the subordinates. They at the same time have to be obligatory towards the duties assigned to them. Responsibility is said to be the factor or obligation of an individual to carry out his duties in best of his ability as per the directions of superior. Responsibility is very important.

Therefore, it is that which gives effectiveness to authority. At the same time, responsibility is absolute and cannot be shifted. Accountability, on the others hand, is the obligation of the individual to carry out his duties as per the standards of performance. Therefore, it is said that authority is delegated, responsibility is created and accountability is imposed. Accountability arises out of responsibility and responsibility arises out of authority. Therefore, it becomes important that with every authority position an equal and opposite responsibility should be attached.

Therefore every manager,i.e., the delegator has to follow a system to finish up the delegation process. Equally important is the delegatee’s role which means his responsibility and accountability is attached with the authority over here.

Centralization And Decentralization –

Centralization –

A pivot location or group of managerial personnel for the planning and decision-making or taking activities of the organization is known as Centralization. In this type of organization, all the important rights and powers are in the hands of the top level management In earlier times, centralization policy was the most commonly practiced in every organization to retain all the powers in the central location. They have full control over the activities of the middle or low-level management.

Apart from that personal leadership and coordination can also be seen as well as work can also be distributed easily among workers.

However, due to the concentration of authority and responsibility, the subordinate employee’s role in the organization is diminished because of all the right vests with the head office. Therefore, the junior staff is only to follow the commands of the top managers and function accordingly; they are not allowed to take an active part in the decision-making purposes. Sometimes hotchpotch is created due to excess workload, which results in hasty decisions. Bureaucracy and Red-tapism are also one of the disadvantages of centralization.

Decentralization

The assignment of authorities and responsibilities by the top level management to the middle or low-level management is known as Decentralization. It is the perfect opposite of centralization, in which the decision-making powers are delegated to the departmental, divisional, unit or center level managers, organization-wide.

Decentralization can also be said as an addition to Delegation of authority.

At present, due to the increase in competition, managers take the decision regarding for the delegation of authority to the subordinates. Due to which the functional level managers get a chance to perform better, as well as freedom of work, is also there. Moreover, they share the responsibility of the high-level managers which results in quick decision making and saving of time. It is a very effective process for the expansion of the business organization, like for mergers and acquisitions.

Although, decentralization lacks leadership and coordination, which leads to inefficient control over the organization. For an effective decentralization process, open and free communication in the organization must be there.

Span of Control

The larger an organization, the more management layers it has. As a result, a hierarchy is born. Multiple people in a department deal with a single superior. Some departments might only have ten people, while others consist of over a hundred employees. In both cases, span of control is present to properly manage all layers of the organization.

The Span of Control is the number of employees a manager can supervise as effectively as possible. The addition of new hierarchical layers makes the organizational structure steeper.The Span of Control is the number of employees a manager can supervise as effectively as possible. The addition of new hierarchical layers makes the organizational structure steeper.A large Span of Control leads to a flatter organizational structure, which results in lower costs.

A small span of control creates a steeper organizational structure, which requires more managers and which will consequently be more expensive for the organization. It is therefore useful for an organization if its managers have a large span of control.

Increasing Span of Control

When a manager supervises a large number of employees, he often has little time to align activities and monitor the quality of how activities are executed.

Every situation needs to be assessed individually based on factors that determine the span of control. If a situation arises in which as supervisor manages too many employees, there are several ways for finding a solution to increase the Span of Control-

Training the manager, teaching him management skills such as delegating and clear communication.

Training employees, teaching them to work independently and make better use of their time.Delegation by the manager, decreasing his workload and improving the division of labour.

Improving procedures and systems; when procedures take up a lot of time, it is a good idea to find efficient solutions with the help of the management team.

Involving HR, who will unburden the manager by taking over certain specialist tasks such as the department’s HR policy.

Assigning a personal assistant, who can take over routine activities, reducing the manager’s workload.

Appointing an assistant-manager who reports to the manager, but in the perception of the subordinates is fully qualified in terms of executive and policy tasks and can act as manager when needed.

Span of Control example

Here are two examples to illustrate the harmony between Scope of control and Span of Control.

First is a situation with a manager with years of experience leading a team of approximately 40 people. Problems arise when his team is reduced to 20 people as a result of cutbacks. At first, everything still seems to be okay. Everyone knows what is expected of them, but as time goes by, the manager starts feeling uneasy. He wants to have more control and make things go his way.

Employees start to feel the manager is constantly looking over their shoulder and see his presence as a hindrance. It is likely that the manager will start to get bored and will no longer be able to find intrinsic motivation in his work. Conflicts may arise and small problems become big ones very easily. In some cases, the manager can feel he is not sufficiently stimulated, which can have very negative consequences.

The second situation involves a manager who is used to leading a team of about five employees. He will experience stress when he is made responsible for a group of 20 people. If the employees are able to function on their own, things might be al-right at first.

But when problems or conflicts arise, the manager needs to be there for all 20 of his subordinates. He will find it difficult to delegate tasks, because he is used to working one-on-one with only about five employees.

The situation becomes more complicated for the manager when the majority of the 20 employees are not able to function independently. The manager will be confronted with his own lack of delegating skills.

In both cases it is important to identify the problem and offer practical solutions.