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LESSON 3- PLANNING AND ORGANIZING

Planning

I. Definition and Nature of Planning

Planning is very important. As by nature, it inquires about organizational goals and targets
and involves decision-making about desired ways and means to achieve them. It is the most
basic of all managerial functions. It is the process by which managers establish goals and
define the methods by which these goals are to be attained. It involves selecting missions
and objectives and the actions to achieve them; it requires decision-making, which is
choosing from among alternative future courses of action. It is, therefore, a rational
approach to achieving pre-selected objectives.

Planning is taken as the foundation for future activities. It is about deciding in advance what
is to be done; that is, a plan is a projected course of action. So, planning can be thought of
as deciding a future course of action. It may also be treated as a process of thinking before
doing.

Management has to plan for long-range and short-range future direction by looking ahead
into the future, by estimating and evaluating the future behavior of the relevant environment
and by determining the enterprise's own desired role. It involves determining various types
and volumes of physical and other resources to be acquired from outside, to allocate these
resources in an efficient manner among competing claims and to make arrangement for
systematic conversion of these resources into useful outputs.

As it is clear, plans have two (2) basic components: goals and action statements. Goals
represent an end state – the targets and results that managers hope to achieve. Action
statements represent the means by which an organization goes ahead to attain its goals.
Planning is a deliberate and conscious act by means of which managers determine a course
of action for pursuing a specific goal.

Planning to a manager means thinking about what is to be done, who is going to do it, and
how and when s/he will do it. It also involves thinking about past events (retrospectively) and
about future opportunities and impending threats (prospectively). Planning enquirers about
organizational strengths and weaknesses and involves decision making about desired ways
and means to achieve them. There are, however, differences between decision-making and
planning. Decisions can be made without planning but planning cannot be done without
making decisions. The nature of planning can be understood by examining its four (4) major
aspects:

Contribution of Planning to the Attainment of Objectives

Since plans are made to attain goals, every plan and all its support should contribute to the
achievement of the organization’s purpose and objectives. An organized enterprise exists to
accomplish group objectives through willing and purposeful co-operation.

Primacy of Planning
That planning is the prime managerial function is proved by the fact that all other functions
such as organizing, staffing, leading and controlling are designed to support the
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accomplishment of the enterprise's objectives. Planning quite logically, therefore, comes first
before execution of all other managerial functions as it involves establishing the objectives
necessary for all group efforts. Also, all the other managerial functions must be planned if
they are to be effective. Likewise, planning and controlling are inextricably bound up. Control
without a plan is meaningless because the plan provides the basis or standard of control.

Pervasiveness of Planning
Planning is a unique and universal function of all managers. The character and scope of
planning may vary with each manager's authority and with the nature of the policies and
plans outlined by superiors, but all managers must have some function of planning. Because
of one's authority or position in the managerial hierarchy, one may do more or less planning,
but some kind or amount of planning a manager must do.

The Efficiency of Plans

Plans should not only be effective, but also efficient. The effectiveness of a plan relates to
the extent to which it accomplishes the objectives. However, a plan is efficient if its
contribution to the purpose and objectives offsets the costs and other factors required to
formulate and operate it. Plans are efficient if they achieve their objective at a reasonable
cost when such a cost is measured not only in terms of time, money, or production but also
in terms of satisfaction of the individual or group. Both conceptual and practical reasons are
put forward in support of planning. Two (2) conceptual reasons supporting systematic
planning by managers are limited resources and an uncertain environment.

II. Types of Plans

Hierarchical Plans – These plans are drawn at three major hierarchical levels, namely, the
institutional, the managerial, and the technical core. The plans in these three (3) levels are a
strategic plan, administrative or intermediate plan, and operational plan.

Frequency-of-use Plans – Plans can also be categorized according to frequency or

repetitiveness of use. They are broadly classified as:

• Standing Plans - which are drawn to cover issues that managers face repeatedly.
Such a standing plan may be called standard operating procedure (SOP). Generally,
five (5) types of standing plans are used: mission or purpose, strategy, policies, rules,
and procedures.

• Single-use Plans - which are prepared for single or unique situations or problems
and are normally discarded or replaced after one use. Generally, four (4) types of
single- use plans are used. These are objectives or goals, programs, projects, and
budgets.

Contingency Plans – These are made to deal with situations that might crop up if these
assumptions turn out to be wrong. Thus, contingency planning is the development of
alternative courses of action to be taken if events disrupt a planned course of action.

III. Planning at Different Levels in the Firm

Planning is the part of management concerned with creating procedures, rules, and
guidelines for achieving a stated objective. Planning is carried out at both the macro and

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micro level. Managers need to create broad objectives and mission statements as well as
look after the day-to-day running of the company.

Strategic Plan – This is a high-level overview of the entire business, its vision, objectives,
and value. This plan is the foundational basis of the organization and will dictate decisions in
the long-term. The scope of the plan can be two (2), three (3), five (5), or even 10 years.

Managers at every level will turn to the strategic plan to guide their decisions. It will also
influence the culture within an organization and how it interacts with customers and the
media. Thus, the strategic plan must be forward-looking, robust but flexible, with a keen
focus on accommodating future growth.

The crucial components of a strategic plan are:

• Vision – Where does the organization want to be five years from now? How does it want
to influence the world?
• Mission – The mission statement is a more realistic overview of the company’s aim and
ambitions. Why does the company exist? What does it aim to achieve through its
existence? For instance, a clothing company might want to “bring high street fashion to
the masses”, while a non-profit might want to “eradicate polio”.
• Values – “I inspire. Go above & beyond. Innovate. Exude passion. Stay humble. Make it
fun.” These aren’t fragments from a motivational speech. These values will guide
managers and influence the kind of employees you hire. There is no template to follow
when jotting down the values. You can write a 1,000-page essay, or something as simple
as Google’s “Don’t be Evil” – it’s all up to you. There are really no rules to writing the
perfect strategic plan. This is an open-ended, living document that grows with the
organization. You can write whatever you want in it, as long as it dictates the future of
your organization.

Tactical Plan – This plan describes the tactics the organization plans to use to achieve the
ambitions outlined in the strategic plan. It is a short range (i.e. with a scope of less than one
year), a low-level document that breaks down the broader mission statements into smaller,
actionable chunks. If the strategic plan is a response to “What?” the tactical plan responds to
“How?” Creating tactical plans is usually handled by mid-level managers. The tactical plan is
a very flexible document; it can hold anything and everything required to achieve the
organization’s goals. That said, there are some components shared by most tactical plans:
• Specific Goals with Fixed Deadlines
Suppose your organization’s aim is to become the largest shoe retailer in the city. The
tactical plan will break down this broad ambition into smaller, actionable goals. The
goal(s) should be highly specific and have fixed deadlines to spur action – expand to two
(2) stores within three months, grow at 25% per quarter, or increase revenues to Php1M
within six (6) months, and so on.
• Budgets
The tactical plan should list budgetary requirements to achieve the aims specified in the
strategic plan. This should include the budget for hiring personnel, marketing, sourcing,
manufacturing, and running the day-to-day operations of the company. Listing the
revenue outflow/inflow is also a recommended practice.
• Resources
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The tactical plan should list all the resources you can muster to achieve the
organization’s aims. This should include human resources, IP, cash resources, etc.
Again, being highly specific is encouraged.
• Marketing, Funding, etc.
Finally, the tactical plan should list the organization’s immediate marketing, sourcing,
funding, manufacturing, retailing, and PR strategy. Their scope should be aligned with
the goals outlined above.

Operational Plan – This plan describes the day-to-day running of the company. The
operational plan charts out a roadmap to achieve the tactical goals within a realistic
timeframe. This plan is highly specific with an emphasis on short-term objectives. “Increase
sales to 150 units/day”, or “hire 50 new employees” are both examples of operational plan
objectives. Creating the operational plan is the responsibility of low-level managers and
supervisors. Operational plans can be either single use, or ongoing, as described below:

Single Use Plans – These plans are created for events/activities with a single occurrence.
This can be a one-time sales program, a marketing campaign, a recruitment drive, etc.
Single use plans tend to be highly specific.

Ongoing Plans – These plans can be used in multiple settings on an ongoing basis. Ongoing
plans can be of different types, such as:

• Policy – A policy is a general document that dictates how managers should approach a
problem. It influences decision making at the micro level. Specific plans on hiring
employees, terminating contractors, etc. are examples of policies.
• Rules – Rules are specific regulations according to which an organization functions. The
rules are meant to be hardcoded and should be enforced stringently. “No smoking within
premises”, or “Employees must report by 9 a.m.”, are two (2) examples of rules.
• Procedure – A procedure describes a step-by-step process to accomplish a particular
objective. For example, most organizations have detailed guidelines on hiring and
training employees, or sourcing raw materials. These guidelines can be called
procedures. Ongoing plans are created on an ad-hoc basis but can be repeated and
changed as required.

Operational plans align the company’s strategic plan with the actual day to day running of
the company. This is where the macro meets the micro. Running a successful company
requires paying an equal attention to now just the broad objectives, but also how the
objectives are being met on an everyday basis, hence the need for such intricate planning.
IV. The Planning Process

1. Define our goals or objectives by identifying desired outcomes or results in very specific
ways.
2. Determine where you stand in relation to set goals or objectives; know your strengths
and weaknesses.
3. Develop premises regarding future conditions; anticipate future events, generate
alternative scenarios for what may happen; identify for each scenario things that may
help or hinder progress toward your goals or objectives.
4. Analyze and choose among action alternatives; list and carefully evaluate possible
actions and choose the alternative most likely to accomplish goals or objectives.

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5. Implement the plan and evaluate results; take corrective action and revised plans
needed.

V. Planning Techniques and Tools

• Forecasting is the process of predicting what will happen in the future.

• Contingency planning involves identifying alternative courses of action that can be
implemented when an original plan proves inadequate because of changing
circumstances.
• Scenario planning is a long-term version of contingency planning that involves identifying
several alternative future scenarios or states of affairs that may occur, and then making
plans to deal with each scenario should it actually occur.
• Benchmarking is a technique that makes use of internal and external comparisons to
better evaluate current performance and identify possible actions to improve the future.
• Participatory planning includes the people who will be affected by the plans and those
who will be asked to implement them in all planning steps.

VI. Decision-making

A decision is a choice among possible alternative actions. Like planning, decision-making is

a challenge and requires careful consideration for both types of decisions, namely:

Structured or Programmed decisions are routine and repetitive, and the organization
typically develops specific ways to handle them. A programmed decision might involve
determining how products will be arranged on the shelves of a supermarket. For this kind of
routine, repetitive problem, standard arrangement decisions are typically made according to
established management guidelines.

Unstructured or non-programmed decisions are typically one-shot decisions that are usually
less structured than a programmed decision.

Everyday a manager must make hundreds of decisions in the organization. Managers do not
function in a theoretical world but they function within the reality that many things are not
known. There are three (3) conditions that managers may face as they make decisions.
They are the following:
• Certainty – This exists only when the managers knows the available alternatives as well
as the conditions and consequences of those actions. There are little ambiguity and
relatively low possibility of making a bad decision. It assumes that manager has all the
necessary information about the situation. Hence, decisions under certainty mean a
perfectly accurate decision will be made time after time. Of course, decision making
under certainty is rare.

• Risk – A state of risk exists when the manager is aware of all the alternatives but is
unaware of their consequences. The decision under risk usually involves clear and
precise goals and good information, but future outcomes of the alternatives are just not
known to a degree of certainty. A risk situation requires the use of probability estimates.
The ability to estimate may be due to experience, incomplete but reliable information,
or intelligence. Statistical analysis can be applied to the calculation or
probabilities for success or failure.
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• Uncertainty – In today's complex environment, most significant decisions are made

under a state of uncertainty where there is no awareness of all the alternatives and the
outcomes, even for the known alternatives. To make effective decisions, managers must
require as much relevant information as possible. Such decisions require creativity and
the willingness to take a chance in the face of such uncertainties. In such situations,
managers do not even have enough information to calculate probabilities and degrees of
risk. So, statistical analysis is of no use. Hence, managers need to make certain
assumptions about the situation to provide a reasonable framework for decision making.
Intuition, judgment, and experience always play major roles in the decision-making
process under conditions of uncertainty.

Hence, we can say that greater the amount of reliable information, the more likely the
manager will make a good decision. Hence, the manager should make sure that the right
information is available at the right time.

Organizing is a broad term that can be interpreted differently by any management theorist.
Some believe that this includes the behavior of all the members of the group. Others argue
that this is the ultimate structure of social and cultural relationship. Generally, most managers
agree that the terms imply a formalized arrangement of deliberate systems, functions and
positions.
In the words of Louis A. Allen, “Organization is the process of identifying and grouping of the
works to be performed, defining and delegating responsibility and authority and establishing
relationships for the purpose of enabling people to work most efficiently”.

What is organization?

Organization is a social unit of people that is structured and managed to meet a need or to
pursue collective goals. All organizations have a management structure that determines
relationships between the different activities and the members, and subdivides and assigns roles,
responsibilities, and authority to carry out different tasks. Organizations are open systems--they
affect and are affected by their environment.

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Nature of Organizing

Effectiveness and efficiency of every personnel are highly important in business

organization in order to achieved its goals, but it could be only done if they know their roles,
duties and responsibilities. It is now therefore the function of managers to define and
delegate responsibilities to the right person who are capable of doing the necessary tasks.

Process of organizing

Organizing, like planning, is a process that needs to be carefully worked out and implemented.
This process involves determining what work is needed, assigning those tasks and organizing
them in a decision-making framework (organizational structure). If this process is not well
conducted, the results may include confusion, frustration, loss of efficiency and limited
effectiveness.. The process of organising consists of the following five steps.
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• Identification of activities – Each organization exists for fulfilling a specific purpose. This
purpose identifies the activities which are performed by the organization. For example, in
a manufacturing organization, production of the goods and their selling are the major
activities in addition to the routine activities. And these activities are in variance with the
activities of a service organization or an organization involved in the trading activities.
Hence the identification of the various activities of the organization is an important step in
the organizing function.

• Grouping of activities – Once the activities have been identified, then there is a necessity
that they are grouped. The activities are grouped in various ways. The activities which are
similar in nature can be grouped as one and a separate department can be created. For
example, activities related to the purchasing, production, marketing, and accounting and
finance can be grouped respectively under purchase, production, marketing, and finance
departments etc. Further in each department the activities can be further subdivided into
various specific jobs.

• Assignment of responsibilities – Having completed the exercise of identifying, grouping

and classifying of all activities into specific jobs, the individual employees comes into
picture since the employees are to be assign with the responsibilities to take care of
activities related to the specific jobs.

• Granting authority – On the basis of specific responsibilities given to individual

employees, they are to be provided with the necessary authority for the discharge of the
assigned responsibilities in order to ensure their effective performance and in turn the
performance of the organization.

• Establishing relationship – This is a very important part of the organizing function since
each employee in the organisation is to know as to whom to report and which are the
employee who are to work with him. This establishes a structure of relationships in the
organization which helps to ensure that the organization has clear relationships. This
structure of relationships also facilitates the delegation.

Classification of Organization

Organizations are basically classified on the basis of relationships. There are two types of
organizations formed on the basis of relationships in an organization

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1. Formal Organization - This is one which refers to a structure of well defined jobs each
bearing a measure of authority and responsibility. It is a conscious determination by which
people accomplish goals by adhering to the norms laid down by the structure. This kind of
organization is an arbitrary set up in which each person is responsible for his
performance. Formal organization has a formal set up to achieve pre- determined goals.
2. Informal Organization - It refers to a network of personal and social relationships which
spontaneously originates within the formal set up. Informal organizations develop
relationships which are built on likes, dislikes, feelings and emotions. Therefore, the
network of social groups based on friendships can be called as informal organizations.
There is no conscious effort made to have informal organization. It emerges from the
formal organization and it is not based on any rules and regulations as in case of formal
organization.

Relationship between Formal and Informal Organizations

For a concerns working both formal and informal organization are important. Formal organization
originates from the set organizational structure and informal organization originates from formal
organization. For an efficient organization, both formal and informal organizations are required.
They are the two phase of a same concern.

Formal organization can work independently. But informal organization depends totally upon the
formal organization.

Formal and informal organization helps in bringing efficient working organization and smoothness
in a concern. Within the formal organization, the members undertake the assigned duties in co-
operation with each other. They interact and communicate amongst themselves. Therefore, both
formal and informal organizations are important.

Organization Structure 1. Line organization

This is the simplest form of structure and refers to a direct straight-line responsibility and
control from the top management to the middle management and to the lower level. It
acquired this name because there are direct single lines of authority and responsibility
between the manager and his subordinates. It is the oldest form of organization structure
based on the classical principle of the Scalar Chain. In this form of structure, authority
passes responsibility-directly to his immediate superior.
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Merits of Line Organization

1. Simplest- It is the most simple and oldest method of administration.

2. Unity of Command- In these organizations, superior-subordinate relationship is
maintained and scalar chain of command flows from top to bottom.
3. Better discipline- The control is unified and concentrates on one person and therefore,
he can independently make decisions of his own. Unified control ensures better discipline.
4. Fixed responsibility- In this type of organization, every line executive has got fixed
authority, power and fixed responsibility attached to every authority.
5. Flexibility- There is a co-ordination between the top most authority and bottom line
authority. Since the authority relationships are clear, line officials are independent and can
flexibly take the decision. This flexibility gives satisfaction of line executives.
6. Prompt decision- Due to the factors of fixed responsibility and unity of command, the
officials can take prompt decision.

Demerits of Line Organization

1. Over reliance- The line executive’s decisions are implemented to the bottom. This results
in over-relying on the line officials.
2. Lack of specialization- A line organization flows in a scalar chain from top to bottom and
there is no scope for specialized functions. For example, expert advices whatever
decisions are taken by line managers are implemented in the same way.
3. Inadequate communication- The policies and strategies which are framed by the top
authority are carried out in the same way. This leaves no scope for communication from
the other end. The complaints and suggestions of lower authority are not communicated
back to the top authority. So there is one way communication.
4. Lack of Co-ordination- Whatever decisions are taken by the line officials, in certain
situations wrong decisions, are carried down and implemented in the same way.
Therefore, the degree of effective co-ordination is less.
5. Authority leadership- The line officials have tendency to misuse their authority positions.
This leads to autocratic leadership and monopoly in the concern.

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2. Line and staff organization

This is done with the assistance of expert specialists. Business leaders have recognized-
as their companies are expanding from simple to complex organizationsthat a small number
of managers can not personally assume direct responsibility for all functions, such as
research , planning, distribution, public relations , industrial relations and many other
business activities. Therefore, one option toward reorganization as a company expands in
size and complexity is to appoint assistants to managers. Specific advisory responsibility is
delegated to these assistants.

Merits of Line and Staff Organization

1. Relief to line of executives- In a line and staff organization, the advice and counselling
which is provided to the line executives divides the work between the two. The line
executive can concentrate on the execution of plans and they get relieved of dividing their
attention to many areas.
2. Expert advice- The line and staff organization facilitates expert advice to the line
executive at the time of need. The planning and investigation which is related to different
matters can be done by the staff specialist and line officers can concentrate on execution
of plans.
3. Benefit of Specialization- Line and staff through division of whole concern into two types
of authority divides the enterprise into parts and functional areas. This way every officer or
official can concentrate in its own area.
4. Better co-ordination- Line and staff organization through specialization is able to provide
better decision making and concentration remains in few hands. This feature helps in
bringing co-ordination in work as every official is concentrating in their own area.
5. Benefits of Research and Development- Through the advice of specialized staff, the
line executives, the line executives get time to execute plans by taking productive
decisions which are helpful for a concern. This gives a wide scope to the line executive to
bring innovations and go for research work in those areas. This is possible due to the
presence of staff specialists.
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6. Training- Due to the presence of staff specialists and their expert advice serves as
ground for training to line officials. Line executives can give due concentration to their
decision making. This in itself is a training ground for them.
7. Balanced decisions- The factor of specialization which is achieved by line staff helps in
bringing co-ordination. This relationship automatically ends up the line official to take
better and balanced decision.
8. Unity of action- Unity of action is a result of unified control. Control and its effectivity take
place when co-ordination is present in the concern. In the line and staff authority all the
officials have got independence to make decisions. This serves as effective control in the
whole enterprise.

Demerits of Line and Staff Organization

1. Lack of understanding- In a line and staff organization, there are two authority flowing at
one time. This results in the confusion between the two. As a result, the workers are not
able to understand as to who is their commanding authority. Hence the problem of
understanding can be a hurdle in effective running.
2. Lack of sound advice- The line official get used to the expertise advice of the staff. At
times the staff specialist also provide wrong decisions which the line executive have to
consider. This can affect the efficient running of the enterprise.
3. Line and staff conflicts- Line and staff are two authorities which are flowing at the same
time. The factors of designations, status influence sentiments which are related to their
relation, can pose a distress on the minds of the employees. This leads to minimizing of
co-ordination which hampers a concern’s working.
4. Costly- In line and staff concern, the concerns have to maintain the high remuneration of
staff specialist. This proves to be costly for a concern with limited finance.
5. Assumption of authority- The power of concern is with the line official but the staff
dislikes it as they are the one more in mental work.
6. Staff steals the show- In a line and staff concern, the higher returns are considered to be
a product of staff advice and counseling. The line officials feel dissatisfied and a feeling of
distress enters a concern. The satisfaction of line officials is very important for effective
results.
3. Functional Organization

It makes use of the pure services of experts or specialists. It was quite natural that the
development of staff departments and positions led to an attempt at complete reorganization
on a functional basis. This removed the staff specialist from his "assisting" capacity and gave
him the purest authority and responsibility for the supervision and administration of the task,
replacing the operational foreman.

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• Gang boss prepares for the production and the worker has to approach him for direction
in this area.
• The Speed boss is assigned with the responsibilities of introducing men and getting the
set standards of production.
• The Inspector is in charge of checking the quality of work.
• The Repair boss takes care of the equipment and tool repairs.
• The job of Order-of-Work Clerk is to plan and schedule order.
• The Instruction Card Clerk determines the best way to do the job.
• The information relating to cost and production is maintained by the Time and Cost Clerk.
The Personnel Activities are handled by the Shop Disciplinarian

Merits of Functional Organization

1. Specialization- Better division of labour takes place which results in specialization of
function and it’s consequent benefit.
2. Effective Control- Management control is simplified as the mental functions are
separated from manual functions. Checks and balances keep the authority within certain
limits. Specialists may be asked to judge the performance of various sections.
3. Efficiency- Greater efficiency is achieved because of every function performing a limited
number of functions.
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4. Economy- Specialization compiled with standardization facilitates maximum production

and economical costs.
5. Expansion- Expert knowledge of functional manager facilitates better control and
supervision.

Demerits of Functional Organization

1. Confusion- The functional system is quite complicated to put into operation, especially
when it is carried out at low levels. Therefore, co-ordination becomes difficult.
2. Lack of Co-ordination- Disciplinary control becomes weak as a worker is commanded
not by one person but a large number of people. Thus, there is no unity of command.
3. Difficulty in fixing responsibility- Because of multiple authority, it is difficult to fix
responsibility.
4. Conflicts- There may be conflicts among the supervisory staff of equal ranks. They may
not agree on certain issues.
5. Costly- Maintenance of specialist’s staff of the highest order is expensive for a concern.

Organization Chart

The organization chart is a diagram graphically showing the relationship of one official to another,
or to others, of a company. It is also used to show the relationship between one department and
another, or between one department and another, or between one organization and another.

Importance of Organizational Chart

Business leaders use the organizational chart in several instances, such as for presentations, to
justify adding or reducing headcount, and to determine where an employee might have the
opportunity to shift job roles.

For the new hire, the organization chart can be a lifeline, helping them to learn names and titles
and to better understand where they fit into the overall corporate structure. New hires get names
thrown at them constantly and the org chart can be a great resource to find out who all those
people actually are. Any employee, in fact, can benefit from having their coworkers names,
photos, and professional and personal profiles at their fingertips.

Types of Organization Chart

1. Master Chart or Chart of Authority.

The master chart shows the entire organizational structure. It is a master plan of the
principal departments, with lines of authority and responsibility and the mutual
relationships of all departments or major components.

2. Functional Chart.
The functional chart shows at a glance the functions and activities of the positions and/or
departments. It shows the major responsibilities of departments or positions. Listed below
each job title are brief statements of the responsibilities.

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3. Personnel Chart.
The personnel chart shows the departments in the same relative manner as the functional
chart. But instead of listing the functions, the titles of the positions of the names of
persons are indicated. The chart also shows the class titles of all positions in the
department together with their locations in the organization.

Reorganization

Reorganization, or business restructuring, is a process where a company does an overhaul of its

current strategy, setup, and operations. Typically, businesses go through reorganization when
they have financial troubles, new owners or staff, or a structural change

Departmentation

Departmentation results from the grouping of work, the desire to obtain organization units of
manageable size, and to utilize managerial ability An organization structure and design are
shaped significantly by the departmentation followed.

Delegation

Delegation is the process of entrusting and transferring responsibility and authority by the top
management to the lowest level. The elements of delegation are the following:

1. Responsibility
This is the work or duty assigned to a particular position. Responsibility involves mental and
physical activities which must be performed to carry out a task or duty. This can be delegated.

2. Authority -It refers to the power or the right to be obeyed. It is also the sum of the powers
and rights entrusted to make possible the performance, of

Accountability This is the answerability of the obligation to perform the delegated responsibility
and to exercise the authority for the proper performance of the work. Accountability cannot be
delegated. Accountability is given to the person who accepts the responsibility and is accountable
only to the .extent that he is given the authority to perform. Each person can be accountable to
only one person, his immediate boss. The superior can only exact responsibility to the extent that
standards of performance are defined.