Line authority is the type of authority given to individuals in managerial positions that allows them to direct the work of subordinates. It’s the power that allows those in charge to make decisions, give orders, and expect those orders to be executed. In the business hierarchy, line authority flows vertically from top management to the lowest ranks within an organization.
The concept of line authority is derived from military organizations where a clear, direct line of authority from the top (e.g., a general) to the bottom (e.g., a private) is crucial for effective functioning.
In a business setting, for example, the CEO of a company has line authority over the company’s senior executives, who in turn have line authority over the managers who report to them, and those managers have line authority over the employees who report to them, and so on. This chain of command allows for clear decision-making and accountability.
However, it’s important to note that while line authority grants managers the right to command, it also comes with certain responsibilities. Managers with line authority are responsible for achieving the organization’s goals in their area of charge and are accountable for the outcomes.
Line authority should not be confused with staff authority, which is the right to advise or assist those who possess line authority. Staff authority is more about providing guidance, support, and expertise, and does not include the power to make final decisions.
Example of Line Authority
Let’s consider a clothing retail company to illustrate line authority.
At the top of the hierarchy, the CEO of the company has line authority over all the divisions of the company. The CEO can make decisions that affect the entire company and give orders that have to be executed by the divisions.
Under the CEO, there might be a Division Manager for each division, such as Sales, Production, Marketing, and Finance. Each Division Manager has line authority over their division. For example, the Sales Division Manager has the power to make decisions about sales strategies and direct the work of the sales team.
Within the Sales division, the Sales Division Manager might have several Store Managers reporting to them, each responsible for one of the company’s retail stores. These Store Managers have line authority over the employees in their store. They can make decisions about how the store is run on a day-to-day basis and give orders to their employees.
In this example, line authority flows vertically from the CEO at the top, through the Division Managers, to the Store Managers at the bottom. Each level of management has the power to make decisions and give orders within their area of responsibility, but they also report to and take orders from the level above them.
It’s important to note that along with this authority comes responsibility. For instance, the Store Manager is responsible for the performance of their store and is accountable to the Sales Division Manager for achieving sales targets and other goals.
This is a simplified example, and the exact structure can vary based on the size and complexity of the organization. For instance, there might be additional levels of management, or there might be staff roles that provide support and advice to the line roles.