Performance of a function or service by an individual is called duty or the activities that an individual is required to perform are a duty on him. He is answerable for the work he has done. Authority is a right of power required to perform a job on the basis of duty assigned to one. An authorized person is empowered to do the assigned job and take a decision.

Power means an ability to do things or get things done by others. Delegation means assigning work to others and giving them authority to do it.

The Board of Directors or the partners or the sole trader possesses all the power or authority to run the firm concerned. If the top management goes for doing the works of the concern, it becomes difficult for it to conduct the business, because of lack of time. Therefore, the work is divided and entrusted to persons who are appointed to look after it.

When persons have been appointed to do a particular job, it can be said that a duty has been assigned to them. The assignment of duty is not complete unless authority has also been given to them.

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Therefore, assignment of duty is followed by authority. When the authority is passed on to the employees, there is a transfer of power to the sub-ordinates; i.e., delegation of powers. Delegation of required authority to the sub-ordinates is necessary to discharge their assigned duty. Delegation of authority is made on the basis of duty one does.

When one is delegated the authority, it means permission is given to do the duties. To be short it can be defined that authority is power to command others to do an act in a manner desired. When authority is conferred on a person, he knows the responsibility.

If authority is not delegated, the assigned duty will not be done by the entrusted person, because he has no authority. It may also happen that sometimes he assumes authority and does the job. In both the cases the position becomes bad. Therefore, responsibility must always be followed by corresponding authority or power.

The difference between authority and responsibility is that they move in opposite directions. Authority always moves from the top downward, whereas responsibility moves upward. Authority is derived from supervisors, to whom the employee is responsible for the proper performance of his work.

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An executive working in a particular position cannot transfer to his sub-ordinates greater power than he himself possesses. One can transfer what one possesses. Sometimes, the sub-ordinates may not be willing to accept the orders from the supervisors, and then the delegation of authority has no meaning.