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Delegation and Decentralization



Basis Delegation Decentralization
Meaning Managers delegate some of their function and authority to their subordinates. Right to take decisions is shared by top management and other level of management.
Scope Scope of delegation is limited as superior delegates the powers to the subordinates on individual bases. Scope is wide as the decision making is shared by the subordinates also.
Responsibility Responsibility remains of the managers and cannot be delegated Responsibility is also delegated to subordinates.
Freedom of Work Freedom is not given to the subordinates as they have to work as per the instructions of their superiors. Freedom to work can be maintained by subordinates as they are free to take decision and to implement it.
Nature It is a routine function It is an important decision of an enterprise.
Need on purpose Delegation is important in all concerns whether big or small. No enterprises can work without delegation. Decentralization becomes more important in large concerns and it depends upon the decision made by the enterprise, it is not compulsory.
Grant of Authority The authority is granted by one individual to another. It is a systematic act which takes place at all levels and at all functions in a concern.
Grant of Responsibility Responsibility cannot be delegated Authority with responsibility is delegated to subordinates.
Degree Degree of delegation varies from concern to concern and department to department. Decentralization is total by nature. It spreads throughout the organization i.e. at all levels and all functions
Process Delegation is a process which explains superior subordinates relationship It is an outcome which explains relationship between top management and all other departments.
Essentiality Delegation is essential of all kinds of concerns Decentralization is a decisions function by nature.
Significance Delegation is essential for creating the organization Decentralization is an optional policy at the discretion of top management.
Withdrawal Delegated authority can be taken back. It is considered as a general policy of top management and is applicable to all departments.
Freedom of Action Very little freedom to the subordinates Considerable freedom

Decentralization can be called as extension of delegation. When delegation of authority is done to the fullest possible extent, it gives use to decentralization.


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Organizing Function