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Line/ Staff Authority, Empowerment and Decentralization (15th Nov)
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Management: Science, Theory and Practice
A Global and Entrepreneurial Perspective
MANAGEMENT
PRINCIPLES OF MANAGEMENT
Sr. No.Chapter No.Chapter Heading11Management: Science, Theory and Practice (27th September 2010)24Essentials of Planning and Managing by Objectives (4th Oct)35Strategies, Policies and Planning Premises (11th Oct)46Decision Making (18th Oct)57The Nature of Organizing, Entrepreneuring, and Reengineering (25th Oct)68Organization Structure: Departmentation (1st Nov)79Line/ Staff Authority, Empowerment and Decentralization (5th Nov)810Effective Organizing and Organization Culture914Human Factors and Motivation1015Leadership1116Committees, Teams and Group Decision Making1218The System and Process of ControllingSessional EvaluationExternal Evaluation1515205050Quiz per ClassAssignment & PresentationMid-termTotal SessionalExternal ExamPlanning
Organizing
Leading
Controlling
YOUR PERFORMANCE
ASSIGNMENTS
Sessional Marks
Compensatory assignments
Classes left? Sunday class? Next few classes
Project (4 groups of 7 each) 15 marks
Portfolio Matrix (Chap 3)
Planning stages of a new company (Chap 2,3)
Departmentation (chap 6)
Controls (chap 18)
Mark dates, assignment to students
Line/ Staff Authority, Empowerment and Decentralization (5th Nov)
Chapter 7
TABLE OF CONTENTS
AUTHORITY AND POWER
EMPOWERMENT
LINE/ STAFF CONCEPTS AND FUNCTIONAL AUTHORITY
DECENTRALIZATION OF AUTHORITY
DELEGATION OF AUTHORITY
THE ART OF DELEGATION
RECENTRALIZATION OF AUTHORITY AND BALANCE AS THE KEY TO DECENTRALIZATION
QUIZ
AUTHORITY AND POWER
Power:
The ability of individuals or groups to induce or influence the beliefs or actions of other persons or groups
Authority:
The right in a position to exercise discretion in making decisions affecting others
AUTHORITY AND POWER
Types of Power:
Legitimate Power: Its the power of an individual because of the relative position and duties of the holder of the position within an organization (A govt officer, a manager, a policeman etc has legitimate power
Expert Power: Its an individuals power deriving from the skills or expertise of the person and the organizations needs for those skills and expertise (Doctors, Lawyers, Professors, Skilled craftsmen have expert power)
Referent Power: Its the power or ability of individuals to attract others and build loyalty. Its based on thecharisma andinterpersonal skills of the power holder (for instance Political leaders, movie stars etc have referent power)
Reward Power: This is the power that arrives from ones ability to grant rewards (for example university professors, managers etc have reward power
Coercive Power: Its the application of negative influences. It includes the ability to demote or to withhold other rewards; the power to punish (a manager can fire the staff, and withhold the rewards as well)
EMPOWERMENT
Empowerment:
Employees at all levels in the organization are given the power to make decisions without asking their superiors or permission
Because they know their work better
Power should be equal to responsibility
It gives participation and bring loyalty
It makes the processes quicker
LINE/ STAFF CONCEPTS AND FUCTIONAL AUTHORITY
Line authority:Its the relationship in which a superior exercises direct supervision over a subordinate- an authority relationship in a direct line or steps
Staff relationship:this is advisory relationship. The staff officers investigate, research and give advice to the line managers
Functional authority:the right delegated to an individual or a department to control specified processes, practices, policies, or other matters relating to activities undertaken by persons in other departments
DECENTRALIZATION OF AUTHORITY
Decentralization:
The tendency to disperse decision making authority in an organized structure is termed as decentralization
Careful selection is to be made on which decisions to push down the hierarchy and which to be kept with the top
Polices are to be made clear
Trainings are to be done and controls are required to be placed
DELEGATION OF AUTHORITY
The process of delegation:
It involves the following four steps
Determining the results expected from a position
Assigning tasks to the position
Delegating authority for accomplishing these tasks
Holding the person in that position responsible for the accomplishment of the tasks
THE ART OF DELEGATION
Personal attitudes towards delegation:
Receptiveness
Willingness to let go
Willingness to allow mistakes by subordinates
Willingness to trust subordinates
Willingness to establish and use broad controls
Overcoming Weak Delegation
Define assignments and 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 and successful assumption of authority
Recentralization of authority
It is the centralization of authority that was once decentralized; normally not a complete reversal of decentralization, as the authority delegated is not wholly withdrawn
ADVANTAGES AND DISADVANTAGES OF DECENTRALIZATION
Advantages:
Relieves top management of some burden of decision making and forces upper level managers to let go of
Encourages decision making and assumptions of authority and responsibility
Gives managers more freedom and independence in decision making
Promotes establishment and use of broad controls that may increase motivation
Makes comparison of performance of different organizational units possible
Facilitates setting up of profit centers
Facilitates product diversification
Promotes development of general managers
Aids in adaptation of fast changing environment
ADVANTAGES AND DISADVANTAGES OF DECENTRALIZATION
Disadvantages:
Makes it more difficult to have a uniform policy
Increases complexity of coordination of decentralized organizational 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 lack of qualified managers
Involves considerable expenses for training managers
May be limited by external forces (national labor unions, governmental controls, tax policies)
May not be favored by economies of scale of some operations
MIDTERM
Question # 1.Define management and name the functions of managers
Question # 2.What is MBO? Write any five benefits or the failures of MBO.
Question # 3.Define Planning and name the types of plans
Question # 4.Draw and describe the portfolio matrix by naming all four SBUs that could be identified out of it.
Question # 5.Define any four of the following:
1. Decision Making
2. Satisficing
3. Programmed decisions
4. Non programmed decisions
5. Creativity
6. Innovation
7. Brain storming
Question # 6.Draw and describe the formal and informal organization
Question # 7.Define Departmentation by customer group and write its advantages and disadvantages