Authority, Responsibility & Accountability

• Authority – The right to give orders or valid

instructions
• Responsibility – This is Obligation to achieve certain
objectives
• Accountability – This is the obligation to report (give
an account) to higher authority for the discharge of
those responsibilities.
• Power – The ability of individuals or groups to
influence the beliefs or actions of other persons or
groups and is more complicated than authority.

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 Relationship
• Accountability flows upwards in an organization,
while responsibility is assigned downwards.
• Responsibility and authority must go hand in hand
• Accountability cannot be expected and flow upwards
unless authority and responsibility have first flowed
down
• Usually subordinates are given responsibility for the
duties assigned to them by their manager and are
accountable to him for their performance

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 Centralization & Decentralization
• Centralization is characterized by decision making
being undertaken at the top levels, while actual work
is carried out at the lower levels.
• Decentralization refers to the systematic devolution
(transference of power) of responsibility and
authority within the structure of an organization.

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• By centralization or decentralization it does not mean
the division of organization into departments or
sections
• It is where decisions are made that determines the
degree of centralization, and it is quite possible for
an organization to have many divisions, all of which
are strictly controlled from a single central source of
authority
• Organizations cannot be totally centralized or
decentralized.

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 Advantages of Centralization?
• Central authority ensures corporate integrity to the organization and preventing
excessive departmentalism.
• Senior management needs to be seen as providing leadership for the organization
as a whole, ensuring that the various parts perform as a team within corporate
objectives.
• In the event of disputes between departments or division, or between
departments and the corporate whole, central authority takes on the role of
referee in the resolution of conflict.
• Centralized authority is necessary for the making of corporate policy and
determining strategic plans across the whole organization.
• It also fulfills other functions such as standardizing procedure and approaches
which are defining and promoting a unity and style and purpose in respect of issue
and practices across the organization such as equal responsibilities practice.
• It also fulfills the purposes of crisis management which is the determination of
action which can be effective across the whole organization in response in serious
emergencies.

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 Advantages of decentralization?
• Decentralization aims to place the authority to make decisions at points as near as
possible to where there are relevant activities take place.

• It utilizes local and immediate knowledge of situations in order to make the timely and
effective decisions within the defined spare of action.

• This is in contrast to centralized decision making which is remote from the point of
impact.

• There is, therefore a clear potential gain in the quality of decision making, but it must
be confined to those situations which do not have wider impact that the area of
responsibility of the decision maker.

• It encourages initiative, stimulates job satisfaction and includes moral by providing

individuals with more control over their work and involvement with the objectives of
the organization.

• It fosters the development of managerial ability at lower levels.

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 Disadvantages of decentralization?
• The principal problem is one of the autonomy of decentralized units, where
independence from the centre can lead to working against corporate policy.

• Centralized authority can lose touch with the details of operations in decentralized
parts of the organization, and the decentralized unit can lose touch with its role as
parts of the whole.

• It is a disadvantage because of the possibility that decision making is very close to

an often involves the affected parties, it can actually turn out to be relatively slow
and represent a compromise based on the need for acceptance.

• Decentralization depends on effective management at the lower levels, and this is

likely to require extensive training which will be costly to the organization.

• Decentralized operations may lead to the duplication of work which will be again a
cost.

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 So, When do we need
DECENTRALIZATION ?

Decentralization will be needed when the

organization is in the process of growing
in the size, as well as when it wants to
increase the need for flexibility and
responsiveness in its operations.

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 What is it called if u start
DECENTRALIZING?

DELEGATION
Delegation is the passing of responsibility
of one level of management to a lower
level.

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 Why do managers refrain from delegating?

• It takes more time to explain what to do than to do

the work oneself.
• Subordinates lack the knowledge, skills and
experience necessary – if you want something done
properly the only way is to do it yourself – attitude.
• Lack of trust in subordinates
• Subordinates do not want additional responsibility,
especially without additional pay or reward.
• Sometimes managers are scared to delegate because
they are afraid to lose their job of their subordinates
performs better than them.

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 BHAI ….. I Have Delegated My WORK…..
SO, can I take REST ?
• When a manager delegates responsibility to another, he
still is accountable to another senior manager regarding the
delegated matter.

• When a manager delegates he should be prepared to live

with the problems and consequences which will arise out
of the delegated work.

• Subordinate’s performance should be judged against the

objectives and standards associated with the responsibility,
not against how the manager would do it.

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 Empowerment

Empowerment is a development from delegation. When delegation

is integrated into the organization, employees are given increased
responsibility for their own work and are allowed to work with
more independence, they become “empowered” and relieved of
detailed instructions and controls.

• Empowerment is a process to increase efficiency and make greater

use of each individuals contribution.
It implies synergy – the total is greater than the sum of the parts
added.

• Empowerment is also about ownership, it is a way involving

people in the operations of the organization, so that they feel
personal responsibility for their actions.

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