--%>

Factors affecting the degree of decentralization

Factors affecting the degree of decentralization

Nature of growth: if the enterprise has grown through internal expansion, it will continue to retain its original structure until it becomes unmanageable. On the other hand, if it has developed through amalgamation or absorption of different business enterprises, it will prefer of its functioning, because in that way it can reap the benefits of the expertise of the each individual unit.

Outlook of the top management: if the top management believes in uniformity, or if it seeks unified control, it will prefer strong centralized planroduning and control. On the other hand, if it has a liberal outlook and believes in the individual freedom, it will go in for decentralization and fewer controls.

Size and dispersal of operations: dividing a small enterprise into a number of divisions may be a costly affair. The best course for it would be to adopt a functional structure with its activities grouped under production marketing finance etc. but in a large enterprise with wide dispersal of operations creation of divisions and department for different activities and sub activities will add to its efficiency and profitability.

Extent of diversification: if the enterprise is dealing in a number of diverse products it cannot retain its efficiency through functional division of work because the production or sales department would not be able to give equal attention to each of the different products manufactured by it. The alternative in such a case would to go in for a separate department or division for each product.

Nature of functions: there should be greater decentralization of the functions for example production marketing and finance. That way the employees engaged in these activities would be encouraged to perform more efficiently. On the other hand in the case of staff functions like personnel recruitment research and development centralization may produce better results.

Availability of able managers: decentralization will be possible only when middle level managers of the enterprise are capable and experienced enough to make important decisions. Where such managers are not to be found centralization and not decentralization would be more beneficial.

   Related Questions in Biology

  • Q : Are arteries carry blood containing

    Are arteries carry blood from the heart to lungs containing venous or arterial blood? What occurs to the blood whenever it passes via the lungs?

  • Q : Describe Market Research Market

    Market Research: The process of gathering, interpreting and analyzing information regarding to a market, regarding to a service or product to be offered for sale in such market, and regarding to the past, potential and present customers for the servic

  • Q : Characterization of class Reptilia How

    How class Reptilia characterized according to illustrations of representing beings, fundamental morphology, skin, circulation, respiration, nitrogen waste, thermal control and kinds of reproduction?

  • Q : Formation of Platelets How platelets

    How platelets are formed and what is its function? What consequences do the clinical condition known as thrombocytopenia yield?

  • Q : Is dark reactions right for chemical

    Why is the nickname “dark reactions” not completely accurate for the chemical phase of photosynthesis?

  • Q : Methods of hemorrhage contention What

    What are the methods of hemorrhage contention termed? Answer: The physiological methods of hemorrhage contention (that is, one of them is blood clotting) are commonl

  • Q : Reproduction in birds Explain how the

    Explain how the reproduction is carried out in the birds ?

  • Q : Define Cost Slope Cost Slope : A) The

    Cost Slope:A) The cost slope is the measure of sensitivity when crashing events: The slope between the normal point and the crash point can be computed; this gradient of the cost slope B) Cost Slope = (Crash Cost – Normal Cost)

  • Q : Introduction of prophylaxis Give a

    Give a brief introduction of prophylaxis?

  • Q : What is Facilities Consolidation

    Facilities Consolidation: It is the manufacturing, distribution and facilities management functions of a corporation are frequently in the crosshairs of cost reduction efforts. It is due to important fixed and variable costs of production, distributio