Centralization

Ø  Centralization means authority is centralized at top level of management. In other words, centralization of authority is the relative retention of decision making authority by top level of management. When top management retains power and authority without delegating to the subordinates in planning and decision making matters. In centralization all units and departmental manager directly report to general manager. The role of subordinates in decision making is minimal in centralized organization is preferred when specialized skills, talent and technologies is too expensive for the organization, to place them in different location.

According to Ricky Griffin, “Centralization is the process of systematically retaining power and authority in hands of higher level manager.”