An organization of non-elected government official is called bureaucracy. Another definition of bureaucracy could be the organization created to implement rules, laws and functions of an institution in order to maintain efficiency and effectiveness.
A historian, Max Weber, wrote about the emergence of bureaucracy from other traditional organizational forms. Max Weber theory is accepted worldwide and describes bureaucracy as an administrative structure developed through rational-legal authorities. In simple words, bureaucracy means a group of administrative people with specialized skills. Bureaucratic structures differ from other traditional structures in Jurisdictional areas, hierarchical principles, government decisions and actions, production means, selection of personnel, and employment conditions. According to Max Weber bureaucracy takes cares of deficiencies of traditional system.
Characteristics of Weber’s Bureaucracy
Some of the functions or characteristics of bureaucratic structure described by Max Weber are:
- Jurisdictional Area
In a bureaucratic structure, there are defined laws and regulations for official jurisdictional areas. Activities to be performed for governance are set as official duties. For ordering discharge of these official duties, authority has a defined set of rules which has to be followed. To perform these duties there is a systematic manner and only people with regulated qualification are employed in a bureaucratic structure.
- Principles of Office Hierarchy
There is a distinct chain of command with levels of graded authority. This means that bureaucratic structure has a system of super and subordinates. In this system the higher offices supervise the working and performance of lower ones. A decision of lower office has still chance of appeal in high office but in a regulated manner. This principle of office hierarchy is present in all types of bureaucratic structures including state or organization.
Management of a modern bureaucracy office is based on writing documentation. These documents have to be kept in original form. A modern office is made up of files, respective apparatus of material implements and body of officials engaged in public office.
- Debt ratios
- Liquidity ratios
- Profitability ratios
- Asset management ratios
- Cash Flow Indicator Ratios
- Market value ratios
- Financial analysis
- Business Terms
- Financial education
- International Financial Reporting Standards (EU)
- IFRS Interpretations (EU)
- Financial software