The right in a position to exercise discretion in making decisions affecting others

1. STAFF AUTHORITY,
EMPOWERMENT, AND
DECENTRALIZATION
CHAPTER # 9

2. AUTHORITY AND POWER
 POWER
The ability of individuals or groups to
induce or influence the beliefs or actions
of other persons or groups.

3. AUTHORITY AND POWER
 AUTHORITY
The right in a position to exercise
discretion in making decisions affecting
others

4. EMPOWERMENT
Means that employees, managers, or
teams at all levels in the organization are
given the power to make decisions without
asking their superiors for permission

5. FORMS OF AUTHORITY
 LINE AUTHORITY
 STAFF AUTHORITY
 FUNCTIONAL AUTHORITY

6. LINE AUTHORITY
(KEY POINTS)
 Line Authority is direct supervisory
authority from superior to subordinate
 It flows in a direct chain of command
from the top of the company to the
bottom

7. LINE AUTHORITY
(KEY POINTS)
 It exists in all organizations as an
uninterrupted scale or series of steps
 Supervisors -- in line departments,
such as marketing and production –
give direct orders, evaluate
performance, and reward or punish
those employees who work for them

8. LINE AUTHORITY
(KEY POINTS)
 It creates a unity of command that
helps employees know to whom they
are accountable, and whom to go to with
a problem

10. STAFF AUTHORITY
(KEY POINTS)
 Staff Authority is more limited authority
to advise
 Staff Supervisors help line departments
decide what to do and how to do it but
do not have the authority to make final
decisions

11. STAFF AUTHORITY
(KEY POINTS)
 They coordinate and provide technical
assistance or advice to all advisors, such
as accounting, human resources,
information technology, research,
advertising, public relations, and legal
services etc

13. SCALAR PRINCIPLE
It Suggests that a clear line of authority
should run through an organization (chain
of command) so that
 Decision making responsibility may be
more clearer
 Organizational Communication may be
more effective

14. FUNCTIONAL AUTHORITY
 It is the right to control selected
processes, practices, policies or other
matters in departments other than a
person’s own.
 It’s a small slice of Line Manager’s
authority.

15. FUNCTIONAL AUTHORITY
 REASONS TO PRACTICE
FUNCTIONAL AUTHORITY
1. Line manager’s lack of Specialized
knowledge
2. Line manager’s inability to supervise
specified processes
3. Danger of diverse interpretations of
Policies

16. DECENTRALIZATION OF
AUTHORITY

17. THE NATURE OF
DECENTRALIZATION
Decentralization is the extent to which
decision-making authority is pushed
down the organization structure and
shared with many lower-level employees

18. DIFFERENT KINDS OF
CENTRALIZATION
 PERFORMANCE BASED
 DEPARTMENTAL
CENTRALIZATION
 MANAGEMENT
CENTRALIZATION

19. DECENTRALIZATION AS A
PHILOSOPHY AND POLICY
DECENTRALIZATION REFLECTS THE
PHILOSOPHY OF ORGANIZATION
AND MANAGEMENT FOR DECISION
MAKING, SELECTION & TRAINING OF
PEOPLE AND ADEQUATE CONTROLS

20. DELEGATION OF AUTHORITY
Delegation is the downward transfer of formal
authority from superior to subordinate

21. STEPS IN DELEGATING

22. THE ART OF DELEGATION
Delegation is an ART or SKILL
One of the secrets of success of Managers is
delegation
Failure in effective delegation occur because
managers are unable or unwilling to apply them

23. PERSONAL ATTITUDES
TOWARD DELEGATION
 Receptiveness:
 Delegation is most effective when Manager
is receptive of ideas of the subordinates
 NIH (Not Invented here) – The idea
belongs to someone else, not the manager
 Willingness to Let Go:
 People who have moved up the ladder
must not interfere in decisions of the
subordinates.
 Ex: Hiring secretary.

24. PERSONAL ATTITUDES
TOWARD DELEGATION
 Willingness to Allow Mistakes by
Subordinates
 Willingness to TRUST Subordinates
 Willingness to Establish & Use broad
Controls

25. OVERCOMING WEAK
DELEGATION
 Following practical guide will facilitate
Delegation
 Define assignments & delegate authority in
light of results expected
 Select the person in light of the job to be
done
 Maintain open lines of communication
 Establish proper controls
 Reward effective delegation & Successful
of authority

26. Recentralization of Authority
 To Centralize authority that was once
decentralized.
 Not a complete reversal of Decentralization
 Its centralization of certain types of
activities only

27. Advantages of Decentralization
 Relieves top management of some burden of decision
making and forces upper-level managers to let go.
 Encourages decision making and assumption of authority
and responsibility.
 Gives managers more freedom and independence in
decision making.
 Promotes establishment and use of broad control which
may increase motivation.
 Makes comparison of performance of different
organization units possible.
 Facilitates setting up of profit centers.
 Facilitates product diversification.
 Promotes development of general managers.
 Aids in adaptation to fast-changing environment

28. Disadvantages of Decentralization
 Makes it more difficult to have a uniform policy.
 Increases complexity of coordination of
decentralized organization units.
 May result in loss of some control by upper-level
managers.
 May be limited by inadequate control techniques.
 May be constrained by inadequate planning and
control systems.
 Can be limited by the availability of qualified
managers.
 Involves considerable expenses for training
managers.
 May be limited by external forces (national labor
unions, government controls, tax policies)