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Centralization & Decentralization of Authority

Centralization involves reserving authority at central points in an organization, such as the top level making major decisions. Decentralization systematically delegates authority to lower levels so subordinates have more independence to decide and act. While centralization allows for focused vision and control, decentralization empowers employees, relieves burden on top management, enables more efficient localized decision-making, and makes expansion easier. Both approaches have trade-offs around coordination, conflict, accountability and preparing for emergencies.

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60 views8 pages

Centralization & Decentralization of Authority

Centralization involves reserving authority at central points in an organization, such as the top level making major decisions. Decentralization systematically delegates authority to lower levels so subordinates have more independence to decide and act. While centralization allows for focused vision and control, decentralization empowers employees, relieves burden on top management, enables more efficient localized decision-making, and makes expansion easier. Both approaches have trade-offs around coordination, conflict, accountability and preparing for emergencies.

Uploaded by

RAJESH
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Centralization &

Decentralization Of
Authority

Centralization is the systematic


and consistent reservation of authority
at central points in the organization.
The implication of centralization can
be : Reservation of decision making
power at top level.
Reservation of operating authority
with the middle level managers.

Reservation of operation at lower


level at the directions of the top level.

Different Kinds of
Centralization
Centralization of performance
Departmental centralization
Centralization of management

Decentralization is a systematic
delegation of authority at all levels of
management and in all of the
organization.
Everything that increasing the role of
subordinates is decentralization and
that decreases the role is centralization
Authority in retained by the top
management for taking major decisions.
Decentralization pattern is wider is
scope.

Implication of
Decentralization
Less burden on the Chief Executive
as in the case of centralization.
Subordinates get a chance to decide
and act independently.
Operations can be coordinated at
divisional level.
Co-ordination to some extent is
difficult to maintain.

Advantage of Centralized
Organizational Structure

Focused Vision
Fast Execution
Reduced Conflict
Control and Accountability

Advantage of Decentralized
Organizational Structure

Empowering Employees
Relieving the Burden
Preparing for Emergencies
More Efficient Decision-Making
Ease of Expansion

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