k9
-that 2*lata* tso activities Involved In pa rf owing a certain
function Is known as functional authority*^0
Drucker, oat of the more critical writers about man*
ageaent today# states that neither functional nop geographic
decentralisation offer the beat means of truly decentralising
managerial authority* He atatea that vhat enterprise nee da la
a new type of organisation that givta all parte of the buainaaa
genuine oanagerial powers over many functions.
This principle is federalism, in whloh the ■■
whole of the enterpriae ia eoneeived as made up
of autonomous unite* She federal enterpriae
and all ita unite are in the esse business* Iba
seas economic factors determine the future of
the whole aa well as of all unite; the a mm
baaie decielons have to be made for all of them}
the same kind and type of executive la needed.
Henee the ihole requirea a unified management
in eharge of the beelo funotlonej the deoielon
what bueineaa the enterprise ia in* the organ*
Uetion of the human reaoureaa and the eelootIon,
training and teatlng of future leaders*
At the sane time, eaeh unit la e busincus
1teeIf* Zt produces lte own producta for a
dlatinet market* Bach unit must therefore have
wide autonomy within the limits eet by the general
folicy decisions of the management of the whole*
a eh unit haa to have lte own management* The
local management will be primarily an operating
management) it will be concerned mainly with the
preaent and the immediate future rather than with
baalo policy* But within a limited scope it will
have alao to discharge real top-management
f motions* 3*
It la difficult to achieve the autonomy by decentralisation
of suthorlty in corporatlona that are organised on a territorial
*°Kooats and O'Donnell, jolt.  p  XU7 
^Veter P# Druoker, Yba Mew Society (*ew fork, 1950)*
pp* 268<*269«