What is meant by "delegation of authority"?

The term "delegation of authority" refers specifically to the assignment of responsibility and authority from one individual to another within an organization. This process is essential for the effective functioning of an organization because it allows for the distribution of tasks and responsibilities among team members, empowering them to make decisions and take action within defined limits. By delegating authority, a manager can focus on higher-level tasks while enabling employees to handle day-to-day operations. This practice also helps in developing future leaders within the organization, as individuals gaining authority through delegation can develop their decision-making skills and understanding of the organization's operations.

The concept of delegation emphasizes the importance of trust, communication, and accountability within a team, as the delegatee is expected to perform the assigned tasks competently and report back to the delegator. This process is fundamental in management practices, streamlining workflows, and enhancing productivity.

In contrast, the other options discuss different scenarios that do not accurately represent the concept of delegation. For example, the transfer of financial resources relates to budgeting or financial management rather than authority. Contracting external entities pertains to outsourcing services, which is a different aspect of organizational operations. Lastly, a document outlining contractual terms concerns legal agreements rather than the assignment of authority. Thus, the focus on responsibility