Chapter – 5 Organising (4+ 3+3 or 6 or 6 = 10 marks)

“Authority can be delegated but responsibility cannot”. Explain the statement in brief–

Or

“Responsibility can be delegated but accountability is absolute” Explain. – 6 marks

According to the principle of absolute responsibility, authority can be delegated but responsibility and accountability cannot be delegated by a manager. The manager is responsible or accountable to his own superior for both, the tasks that he has assigned his subordinates and the acts of his subordinates. In other words only authority can be delegated but responsibility and accountability is absolute.

Example: if a foreman fails to get 100 units produced by the workers on any day, he is responsible to his superior. He cannot escape by saying that the workers were at fault. Similarly, the factory manager remains responsible to his superior for the work he entrusted to this foreman. He cannot escape from the responsibility by passing on the blame to his foreman.

Why is it necessary to delegate authority? Give three reasons? (Importance/advantages of delegation of authority)

Or

Delegation of authority helps in reducing the workload of managers and in motivating the subordinates.” Explain this statement – 6 marks V. Important

It is necessary to delegate authority due to the following reasons:

• It reduces the workload of managers. By sharing some of his own work with the subordinates, the manager is able to concentrate on more important jobs. This way he increases his own effectiveness and that of his subordinates. When delegation of authority takes place at all levels of the organisation it leads to proper division of work and assignment to all managers in a systematic manner.
• It establishes a superior-subordinate relationship. The flow of authority from top to lower level of management is directed and controlled by the process of delegation. This gives meaning and content to the flow of authority and to managerial jobs.
• It increases morale of the subordinates: Delegation helps the subordinate to develop their capabilities to handle new and more challenging jobs. This gives him job satisfaction. it increases his morale, self confidence and efficiency to get promotion.

Explain the term “decentralization” in brief? – 3 marks

• Decentralisation means delegating authority at all management levels and all departments of the organisation to take decision and appropriate action on tasks assigned to them.
• In a decentralized organisation, while top management have authority to frame policies and take major decisions; middle and lower level managers have authority for taking decisions on tasks assigned to them.
• Example: In an organisation, major decisions on products, line of business, capital investment, etc are made by top management while marketing manager for example is authorised to decide on prices of products, distribution channels, methods of advertising the products and organising sales campaigns. Top management does not interfere with his authority. However, marketing manager is required to keep in view the overall policies of the organisation while making decisions concerning matters within his authority. This organisation may be regarded as a decentralized one.

“The concept of decentralisation is related to the concept of delegation.” Explain this statement in brief. – 4 marks

• Decentralization refers to the dispersal of authority to take decisions to the lower level of an organisation where the problem arises.
• Delegation means entrustment of responsibility and authority from one individual to another. The concept of decentralisation is wider in scope and coverage.
• Decentralisation is completed only when the fullest possible delegation is made to all or most of the people who are delegated a specific kind of work or responsibility.

Explain the concept of delegation and decentralisation bringing out its distinction

Or

Dist between: (All points are important as any 3 are specifically asked in the CBSE paper– 3 marks or 6 marks

	DELEGATION OF AUTHORITY	DECENTRALIZATION
Scope	Scope is limited to the manager and his immediate subordinates in the work unit.	Scope is wider than delegation as it involves delegation of authority at all levels and in all functions of the organisation.
	It is entrusting authority from one person to another	It is an extension of delegation to the lowest level in the firm.
Significance	Delegation is compulsory in every organisation at every level.	Decentralisation is optional and is decided by the top management if it wants or does not want it.
Freedom of Action	Manager exercises control over activities of subordinate	Managers of work units have greater freedom of action. They are not kept under close supervision by their superiors but have to work under guidelines and performance targets set by top management
Essentiality	Organisation cannot function without delegation of authority	Organisation can function without decentralisation.
Responsibility	Responsibility cannot be delegated	Responsibility can be delegated
Grant of Authority	Delegated authority can be withdrawn by delegator.	Cannot be easily withdrawn as introduced by top management.