5 How Do Centralization and Decentralization Differ?
Traditional View
One of the questions that needs to be answered when organizing is “At what level are decisions made?” Centralization is the degree to which decision making takes place at upper levels of the organization. Decentralization is the degree to which lower-level managers provide input or actually make decisions. Centralization-decentralization is not an either-or concept. Rather, it’s a matter of degree. What we mean is that no organization is completely centralized or completely decentralized. Few, if any, organizations could effectively function if all their decisions were made by a select few people (centralization) or if all decisions were pushed down to the level closest to the ...
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