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CMA Foundation · Fundamentals of Business Economics and Management · Organisation Structure, Responsibility, Accountability and Delegation of Authority

A factory manager delegates the purchase of spare parts to a store officer, giving him the duty to buy but no power to sign purchase orders or release payments. According to management principles, what is the most likely result?

The likely result is responsibility without matching authority, causing frustration and poor performance. The store officer is told to buy parts but cannot sign orders or release payments, so he cannot discharge the duty. Authority should be commensurate with responsibility for delegation to work.

  1. AResponsibility without matching authority, leading to frustration and poor performanceCorrect
  2. BAuthority without responsibility, leading to misuse of power
  3. CComplete decentralisation of the purchase function
  4. DElimination of the manager's accountability

Explanation

The officer has the duty to buy but lacks the power to sign orders or pay. Responsibility should be matched by equal authority; when it is not, the subordinate cannot perform and becomes frustrated. Option B describes the opposite mismatch.

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