The production manager cannot blame the foreman, if he is not able to achieve the desired target, as the authority delegated to a subordinate should be equal to his responsibility. Authority and responsibility of a subordinate should go hand in hand.

This principle suggests that if a subordinate is given the responsibility to do a particular task in a proper manner, he should be given adequate authority to perform the task. Similarly, if a subordinate is given authority to do a particular task in the proper manner.

In this case, the production manager has not given authority to the foreman for the requisition of tools and materials from the stores department. Therefore, foreman cannot be held responsible for not achieving the desired result. But, the director can blame the production manager for not achieving the target.

Delegation of authority refers to granting authority by one individual (superior) to another (subordinate). Therefore, its scope is confined to a manager and his immediate subordinate. When we delegate authority, we multiply it by two i.e. the delegator and his subordinate, to whom authority is delegated. Delegation is a process of sharing of task and authority between a manager and his subordinate.
Decentralisation of authority is not restricted to two individuals. It involves systematic delegation of individuals. It involves systematic delegation of authority at all levels and in all functions of the organisation. In case of decentralisation, managers at middle and lower levels are granted the authority for taking decisions on tasks assigned to them. Therefore, the scope of decentralisation is wider than that of delegation. When we decentralise authority, we multiply it by many.

Two principles of delegation are:
(i) Accountability cannot be passed on, with delegation of authority.
(ii) Authority granted to a subordinate can be withdrawn and redelegated to another.

The functional structure suffers from the following disadvantages:
(i) It is difficult to hold a single department responsible for any problem.
(ii) As departments grow in number, coordination becomes difficult.
(iii) Conflicts may arise between departments.

According to Allen, 'Organising is the process of identifying and grouping the work to be performed, defining and delegating responsibility and authority and establishing a pattern of relationships for the purpose of enabling people to work most effectively together in accomplishing objectives'.

Yes, decentralization is an optional policy, yet it is important in the organization.
It refers to a systematic delegation of authority at all levels of management and in all departments of the organisation to take a decision.
Importance of decentralization
1. Develops Initiative Among subordinates
It helps to promote self-reliance and confidence amongst the subordinates.This is because, lower managerial levels have been given freedom to take their own decisions and they learn to depend on their own judgment. It also helps to identify those executives, who have the potential to become dynamic leaders.
2.Develop Managerial Talent for the future
Formal training along with the experience of handling independent assignments helps to create a reservoir of qualified and capable managers, who can take up more challenging positions in the upcoming ventures of the organization.
3. Quick Decision-Making
Under decentralization, authority to make decisions is placed in the hands of those, who are responsible for executing the decisions. Since decisions are taken at levels nearest to the point of execution, there is no delay or distortion of information.
4.Relief to Top Management
It helps to reduce the amount of direct supervision over subordinates by giving them freedom to take a decision and act on their own. This reduces the workload of top executives and they can devote their time and attention to important policy matters.
5. Facilitates Growth
It provides greater autonomy to lower level managers and departmental heads.
This encourages them to function more efficiently to prove their supremacy, and facilitate expansion and growth of the organization.
6. Better Control
It makes it possible to evaluate performance at each level and making the departments accountable for their own results.Feedback is quick and leads to better control.

Delegation refers to the downward transfer of authority from a superior to a subordinate.
Importance of delegation
1.Effective Management 
By empowering the employees, the managers are able to function more efficiently as they get more time to concentrate on important matters.
2. Employee Development
Delegation provides more opportunities to the employees to utilize their talent and develop latent abilities. It helps to make them better leaders and decision makers, thus, creating future managers.
3. Motivation of Employees
Delegation provides a feeling of status and recognition to subordinates, as it is not only a process of sharing the workload, but also involves trust of the superior on his subordinate. Entrustment of responsibility builds up his esteem and encourages him to perform better.
4. Facilitation of Growth
Delegation helps in the expansion of an organisation by providing a ready workforce to take up leading positions in new ventures. Trained and experienced employees are able to play a significant role in launching new projects of the organisation.
5. Basis of Management Hierarchy
Delegation of authority establishes superior-subordinate relationships, which are the basis of a hierarchy of management. This helps employees to know 'who has to report to whom'. Thus, duties and powers of each individual become clear.
6. Better Coordination
The elements of delegation namely authority, responsibility and accountability help to define the powers, duties, and responsibilities related to various positions in an organisation. This helps to avoid overlapping and duplication of work and facilities coordination, as it gives a clear picture of the work being done at various levels.

Formal Organisation
It is a system of well-defined jobs, each bearing a definite jobs, each bearing a definite measure of authority, accountability and responsibility.
Informal Organisation It is a network of social and personal relationships, which originates spontaneously as a result of interaction amongst people at work.
Advantages of Informal Organisation
Informal organisation has the following advantages:
(i) Prescribed lines of communication are not followed. Thus, it facilitates quick feedback and spreads information faster.
(ii) It provides a sense of belongingness and gives due respect to social and psychological needs,
(iii) It provides the necessary environment for individual creativity and innovation.
(iv) It contributes to fulfilment of goals, promoting the feeling of cooperation among employees.
Disadvantages of Informal Organisation
 Informal organisation has the following disadvantages:
(i) Informal organisation structure spreads rumours.
(ii) It opposes the policies and changes of management.
(iii) It generally prefers status quo and existing work routine.
(iv) It gives imporatnce to individual interest as compared to organisational interest.
(v) It pressurises members to conform to group expectations.