Sunday, August 12, 2012

Factors affecting decentralization


1.       Management philosophy: - When management is commitment in decentralization of authority. When top level management is highly supportive in decentralization. When top level management involves middle and lower level management in decision making and planning at that time decentralization is adapted.

2.       Organizational size: - As organizations grow higher and bigger and become more complex to manage decentralization is required.

3.       Organization: - If the organization is adapting decentralization approach from very beginning then it wants to give continuation of decentralization.

4.       Dispersal of organization: - Instead of locating in one or two places if the organization is scattered in various places at that time decentralization is required.

5.       Capacity of lower level: - If the lower level managers are highly competent enough decentralization is needed. But, if lower level management is not competent decentralization is not needed.

6.       Organizational environment: - Technological and competitive forces in the environment affect decentralization. Fast changing environment and complex task need decentralization.

7.       High cost: - Because of high cost decentralization may not be preferred. Therefore, highly economically capable organization applies decentralization.

No comments:

Post a Comment