Professional Documents
Culture Documents
AUTHORITY
AND
PERFORMANCE
ACKNOWLEDGEMENT
Introduction
Objectives
Review of Literature
Methodology
Result
Conclusion
INTRODUCTION
As Pfiffner and Sherwood put it, "here is where the basic values of the
organisation are involved; and here is where the struggle for control, power and authority is
at its lowest." Therefore, it is of paramount importance to study the concepts of authority
and responsibility to understand the administrative dynamics and processes in
organisations. The modem thinking about public officials is that the ultimate control is
internal. It is a feeling of self-responsibility in a person. A study of such factors help the
students of administration to understand the public bureaucracy and its role in a democratic
state.
REVIEW OF LITERATURE
.
Acc. to Rhyns Andrew,George Boyne,Jennifer law and Richard M.walker………………….
They tested the separate and joint effects of centralization and organizational
strategy on the performance of 53 UK public service organizations. Centralization is
measured as both the hierarchy of authority and the degree of participation in decision
making, whereas strategy is measured as the extent to which service providers are
prospectors, defenders, and reactors. They found that centralization has no independent
effect on service performance, even when controlling for prior performance, service
expenditure, and external constraints. However, the impact of centralization is contingent
on the strategic orientation of organizations.
With the development of the modern corporation, corporate boards have been
the locus of corporate authority, and particularly since the 1980s, boards and
their performance have been under intense scrutiny. Nevertheless, corporate
law has not developed a consistent theory for what boards are supposed to do;
instead, it sends mixed messages about the functions and expectations of
boards and the appropriate people to sit on them. The HP saga illustrates some
of the dilemmas faced by directors confronted by these competing pressures.
Acc. to P.Canice,T.H.Robert…………………
Objective measures of employee performance are rarely available. Instead,
firms rely on subjective judgments by supervisors. Subjectivity opens the door
to favoritism, where evaluators act on personal preferences toward
subordinates to favor some employees over others. Firms must balance the
costs of favoritism arbitrary rewards and less productive job assignments
against supervisors' demands for authority over subordinates. He analyzed
the conditions under which favoritism is costly to organizations and the effects
of favoritism on compensation, the optimal extent of authority and the use of
bureaucratic rules.
Corruption, resource extraction and waste by policymakers are endemic to any polity, and
are often a source of poor economic performance. Voters in democracies can reduce this
dissipation by revoking the authority of their elected officials at election times, but only if
they have the information necessary to allocate responsibility for poor economic
performance to this corrupt and inefficient leadership. This paper investigates the
incentives of policymakers to provide this information about their actions and behavior, and
investigates the differences in this willingness to be transparent across regime types. Key
to understanding a policymaker's willingness to be transparent is his/her susceptibility to
unfair eviction. If a policymaker can be tossed out of office when aggregate conditions are
poor (which is observed by the voters directly), but waste and corruption have not been
excessive (but these are not directly observed), this policymaker may be unfairly evicted
from office. In order to avoid such a fate, a policymaker may provide more transparency-
enhancing institutional devices to avoid such an outcome.
Acc to b.a.john………
his study investigates whether Code section knowledge, which allows direct
access to relevant , affects tax research programme . This understanding is
important because tax professionals are constantly searching the Code for
relevant authority to resolve their clients' research questions, and because the
Code is the ultimate source of tax authority . The research question is
examined through an experiment that compares the research performance of
experienced tax professionals and inexperienced graduate tax students when
performing either a Code section or a topical search. The results indicate that
experienced subjects are better able than inexperienced subjects to use Code
section knowledge in tax research. In addition, the experienced subjects using
the Code section method retrieved more relevant authority than any other
group of subjects. Taken together, the results provide empirical evidence that
Code section knowledge complements tax professionals' technical knowledge
and improves tax research performance
Acc to B.George…………….
Acc to R.SURI…………………….
Markets work best when the rules of the game are stable, property rights are secure and
contracts are observed. These conditions are promoted by the rule of law in the classical
liberal sense of the supremacy of general laws over public and private authority. Devices
such as mixed government and the separation of powers are believed to be conducive to
the rule of law. However, the degree of formal separation of powers in a constitution does
not always co-relate to rule of law conditions and hence to economic performance. Hence
the speculation that the separation of powers is not a necessary condition to the rule of
law. The paper argues against such a conclusion by developing an account of the
separation of powers that focuses on its methodological thesis in addition to its better
known thesis of the diffusion of power.
Acc to K. David…………
.Using a sample of 140 managers, he investigated the use of various metrics in
determining the periodic assessment, bonus decisions, and career paths of
business performance unit managers. He showed that the weight on accounting
return measures is associated with the authority of these managers, and we
document that both disaggregated measures (expenses and revenues), and
non-financial measures play a greater role as interdependencies between
business units increase. The results suggest separate and distinct roles for
different types of performance measures. Accounting return measures are
used to create the proper incentives for managers with greater accountability ,
while disaggregated and non-financial measures are employed in response to
interdependencies.
Acc to C.Abdur……………..
Only a successful implementation of an overall reform program will enable Russian banks
to provide financial intermediation and assist in the country's development from a nascent
market economy to a mature financial system. The chances for reform are better now than
at any time during the last decade. Favorable political and economic conditions and a
change in attitude among bank management have created an unusual window of
opportunity. The paper analyzes the past performance of the Russian banking industry,
evaluates the reform agenda of the monetary authority , and argues for an overall reform
program in order to seize the available opportunit
Acc to A.k.Rajesh,S.A.Andrew………….
Empirical research on the principal-agent model has focused almost exclusively
on the incentives provided to chief executive officers. However, the model is
also directly relevant to the incentives provided to other top executives.
Furthermore, the extent to which other executives will be provided with high-
powered incentives to maximize firm profits depends critically on the other
measures of their performance that are observable to the shareholders. Top
managers who have important divisional responsibilities within the firm have
more precise signals of their effort than the overall performance of the firm.
Consequently, the compensation of this group of executives will be less
sensitive to firm performance than will the compensation of top managers with
broad oversight authority. We find robust empirical support for this proposition
using a comprehensive panel dataset of executives at large corporations. We
also show that the aggregate pay performance sensitivity of the top
management team is quite substantial. These findings are consistent with a
principal-agent model in which shareholders optimally utilize multiple signals of
executive effort in determining compensation. Their results suggest that the
principal-agent model is an appropriate characterization of the internal
organization of the firm.
ACC to J.M.Renee…………………
.
The concept of competition between the federal government and the states
was central to the framers' vision of our constitutional structure. In the framers'
view, federal-state regulatory competition ensured an alternative regime to
citizens dissatisfied with the dominant regulator’s performance . Recently, the
dynamics of federalism have shifted power in the securities enforcement field
from the SEC to certain state securities regulators. The states, rather than the
SEC, have led enforcement efforts in the Wall Street analyst conflicts and the
mutual fund trading investigations. This shift in authority has prompted
renewed debate over whether a uniform national system of securities
regulation is preferable to the current dual system. The rising profile of state
officials, and calls from certain quarters to curtail states' enforcement powers,
presents a paradigm through which to assess how a dynamic federalist system
helps to ensure optimal regulatory policies and practices.
Acc to W. JULIE………..
Acc. To A.Philipe,T.Jean………
Real authority is determined by the structure of information, which in turn depends
on the allocation of formal authority. An increase in an agent's
real authority promotes initiative but results in a loss of control for the principal. The
paper analyzes the allocation of formal authority as well as some determinants of
the subordinates' real authority: overload, lenient rules, urgency of decision,
reputation, performance measurement, and multiplicity of superiors. Finally, the
amount of communication in an organization is shown to depend on the allocation
of formal authority.
Research methodology
The methodology adopted in the study has been organization research which
means study of cultural effect which is prevailing inside and outside the
organization. It consisted collection of secondary data. The study is on the basis of
secondary data. I collected data from external sources during my research.
SECONDARY DATA
Secondary data are data that have been collected for another purpose and where
we will use Statistical Method with the Primary Data. It means that after performing
statistical operations on Primary Data the results become known as Secondary
Data.
Secondary data is information gathered for purposes other than the completion of a
research project. A variety of secondary information sources is available to the
researcher gathering data on an industry, potential product applications and the
market place. Secondary data is also used to gain initial insight into the research
problem.
• Federal government
• Provincial/state governments
• Academic publications
• Library sources
• Computerized bibliographies
Henry Fayol, defined authority as the right to give orders and the power to exact
obedience. Thus, authority is the legitimate right to command or influence others to behave
toward the attainment of specific goals of an administrative system. In the administrative
system, each position has specific rights that job holders acquire from the title of the
position. As Allen puts it, "authority is the sum of the powers and rights entrusted to make
possible the performance of work delegated". However, authority is not just confined to the
commands, rights and instructions of superiors in organizations.
The other equally important side of authority is obedience and acceptance. Chester
Barnard was one of the writers who had recognized the importance of obedience and
acceptance in the organizational process. According to him, "authority is the character of a
communication in a formal organization by virtue of which it is accepted by a contributor
to or member of the organization as governing or determining what he does or is not to do
so far as the organization is concerned." In other words, authority is the legitimate right to
guide a person's behavior in an organization subject to the condition that the person accepts
that right by showing obedience to it.
AUTHORITY AND POWER
Authority is an inseparable part of rights inherent to a position. These rights are constant,
irrespective of the persons holding the position. In other words, authority is legitimate and
positional. Power is the capacity to influence the decision-making of an authority holder.
Power may be described as the influence to change the behaviour of a person or persons to suit the
power holder's objectives and advantages. Authority is closely related to the, ' concept of power.
Administrative system and various administrative organizations and offices are involved in
exercising their powers in the government. Thus, authority may be defined as the legitimate power
of office holders in administrative organizations. Power not supported by law, constitution and
norms is illegitimate. Illegitimate power is dangerous to the society. The legitimate power or
authority is the servant of the people and it should not
become the master of the people in a democratic society. Legitimate power or authority is to be used
in public interest in a society. To safeguard the people in general from illegitimate power we have
several mechanisms that act as limits and controls.
RESPONSIBILITY
Responsibility is the obligation to carry out certain duties. It has an inseparable relationship with
authority. Without authority it is not possible to take up responsibility.
An administrator, while giving authority to his subordinates should also make them responsible
for exercising authority judiciously and purposefully. Responsibility is of two kinds, viz., operating
responsibility and ultimate responsibility.
An administrator can delegate operating responsibility to his subordinates but not the ultimate
responsibility.
The ultimate responsibility can never be delegated. The three concepts of authority ,responsibility
and accountability are the integral parts of the process of administration.
Authority is the right to command, responsibility is the duty to carry out the command, and the
accountability is the term used to denote the proper discharge of thc duties in letter and spirit. A
person's responsibility is complete only when the duties are done according to the letter and spirit of
the command. According to traditional administrative theory, there is a distinction between two
forms of authority relationships, viz., line authority and staff authority .
.
Line authority denotes direct and ultimate responsibility for achieving results.
Line authority can be equated to a superiors' authority, white staff authority can be
equated to that of the staff. Staff authority is advisory in nature.
One way of differentiating line and staff is by defining its role in the ultimate
responsibility in achieving the result
PERFORMANCE
EXPLANATION
• 1 )
In an effective organization, work is planned out in advance.
Planning means setting performance expectations and goals for
groups and individuals to channel their efforts toward achieving
organizational objectives. Getting employees involved in the
planning process will help them understand the goals of the
organization, what needs to be done, why it needs to be done,
and how well it should be done.
ORGANISATION STRUCTURE
Matrix structure
Conflicts are minimal, and those requiring hierarchical referrals are more
easily resolved
• There is a better balance between time, cost and performance
• Authority and responsibility are shared
DELEGATION OF AUTHORITY
A manager alone cannot perform all the tasks assigned to him. In order to meet the
targets, the manager should delegate authority. Delegation of Authority means division of
authority and powers downwards to the subordinate. Delegation is about entrusting
someone else to do parts of your job. Delegation of authority can be defined as subdivision
and sub-allocation of powers to the subordinates in order to achieve effective results.
ELEMENTS OF DELEGATION
1. Authority - in context of a business organization, authority can be defined as the
power and right of a person to use and allocate the resources efficiently, to take
decisions and to give orders so as to achieve the organizational objectives.
Authority must be well- defined. All people who have the authority should know
what is the scope of their authority is and they shouldn’t misutilize it. Authority is the
right to give commands, orders and get the things done. The top level management
has greatest authority. Authority always flows from top to bottom..
2. Responsibility - is the duty of the person to complete the task assigned to him. A
person who is given the responsibility should ensure that he accomplishes the
tasks assigned to him. If the tasks for which he was held responsible are not
completed, then he should not give explanations or excuses. Responsibility without
adequate authority leads to discontent and dissatisfaction among the person.
Responsibility flows from bottom to top. The middle level and lower level
management holds more responsibility. The person held responsible for a job is
answerable for it. If he performs the tasks assigned as expected, he is bound for
praises. While if he doesn’t accomplish tasks assigned as expected, then also he is
answerable for that.
For achieving delegation, a manager has to work in a system and has to perform
following step
1. Assignment of Duties – The delegator first tries to define the task and duties to
the subordinate. He also has to define the result expected from the subordinates.
Clarity of duty as well as result expected has to be the first step in delegation.
2. Granting of authority – Subdivision of authority takes place when a superior
divides and shares his authority with the subordinate. It is for this reason, every
subordinate should be given enough independence to carry the task given to him
by his superiors. The managers at all levels delegate authority and power which is
attached to their job positions. The subdivision of powers is very important to get
effective results.
3. Creating Responsibility and Accountability – The delegation process does not
end once powers are granted to the subordinates. They at the same time have to
be obligatory towards the duties assigned to them. Responsibility is said to be the
factor or obligation of an individual to carry out his duties in best of his ability as per
the directions of superior. Responsibility is very important. Therefore, it is that which
gives effectiveness to authority. At the same time, responsibility is absolute and
cannot be shifted. Accountability, on the others hand, is the obligation of the
individual to carry out his duties as per the standards of performance. Therefore, it
is said that authority is delegated, responsibility is created and accountability is
imposed. Accountability arises out of responsibility and responsibility arises out of
authority. Therefore, it becomes important that with every authority position an
equal and opposite responsibility should be attached.
DELEGATION PROCESS
RESULTS
CONCLUSION
The use of performance management in the best-practice
companies is not because it is a better technique than performance
appraisal, but because it can form one of a number of integrated
approaches to the management of performance .The appeal of
performance management in its fully realized form is that it
pervades every aspect of running the business and helps to give
purpose and meaning to those involved in achieving the
organizational success.
Barbara Black
University of Cincinnati - College of Law
Erasmus U. Morah
Joint United Nations Programme on HIV/AIDS (UNAIDS)
Mira Ihalainen
UNAIDS
Development Policy Review, Vol. 27, No. 2, pp. 185-214, March 2009
Challenges to Implementing
Strategic Performance Measurement Systems in Multi-
Objective Organizations: The Case of a Large Local
Government Authority
Claudine Umashev
Queensland University of Technology - School of Accountancy
Roger J. Willett
University of Otago
Abacus, Vol. 44, No. 4, pp. 377-398, December 2008
Authority, Risk, and Performance Incentives: Evidence
from Division Manager Positions Inside Firms
Julie Wulf
Harvard Business School
Journal of Industrial Economics, Vol. 55, No. 1, pp. 169-196, March 2007
Suri Ratnapala
The University of Queensland - T.C. Beirne School of Law
April 2006
August 2003
Andrew A. Samwick
Dartmouth College - Department of Economics; National Bureau of Economic Research (NBER)
September 1999
Philippe Aghion
Harvard University - Department of Economics; Centre for Economic Policy Research (CEPR);
National Bureau of Economic Research (NBER)
Jean Tirole
University of Toulouse 1 - Industrial Economic Institute (IDEI); University of Toulouse 1 - Groupe de
Recherche en Economie Mathématique et Quantitative (GREMAQ); Centre for Economic Policy
Research (CEPR)
JOURNAL OF POLITICAL ECONOMY, Vol 105 No 1, February 1997
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