At Gautam Ltd. all bills for traveling are processed by Anandita, the General Manager. She feels quite overburdened with the work and delegates her authority to Prakash, Deputy General Manager. But after some time Prakash also feels overburdened and with prior approval of Anandita, disperses his authority to various levels throughout the organisation. Now all bills for traveling are processed through respective departmental supervisors :

(i) Which concept under organising function is used before and after Anandita feels poo, overburdened with work?

(ii) Define the concepts identified in this case study.

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Solution

(i) Before being overburdened, centralisation existed at Gautam Ltd. as Anandita was the sole authority of processing bills for traveling. When she delegated her authority to Prakash, decentralisation existed at Gautam Ltd. and Prakash had further extended his authority across respective departmental supervisors.

(ii) Centralisation is the systematic and consistent reservation of authority at the centralised positions within the organisation thus implying that the control and decision-making lie at the top or with senior-levels of management like Anandita. Decentralisation is when a certain extent of centralised authority with the senior management can be distributed between the subordinates through delegation to traveling from Anandita.

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