Decentralization of Authority
By decentralization of authority we mean dispersal of decision-making authority at various levels in the organization. In a centralized set-up, decision-making authority is concentrated at the top-level of the management, whereas in the decentralized set-up, many important decisions are made at the lower level also. The most significant feature of decentralization of authority is that most of the decisions made at the lower level do not need approval of the seniors. This means greater freedom is given in decision-making to lower level managers and supervisors in the organization.
Factors Determining the Degree of Decentralization- Importance and significance of the decision: One of the important factors determining the degree of decentralization of authority is costliness of the decision.