Purchase Solution

Pros and cons of decentralized organizations for decisions

Not what you're looking for?

Ask Custom Question

I need help analyzing the advantages and disadvantages of decentralized organizations based on decision-making, include examples of performance measurement in decentralized organizations.

Purchase this Solution
Solution Summary

Your discussion is 605 words and includes four scholarly references.

Solution Preview

ADVANTAGES

Decentralized organizations enjoy more diversity to explore opportunities, can optimize local conditions and can earn more rewards for individual performance. Managers in decentralized units are given the charge to try to figure it out for themselves. For instance, in a decentralized retain chain, the local manager can decide what products to carry since they have more detailed information about the local area and so may be able to make more responsive decisions than a central remote decision maker. Decentralized settings are seen as more motivating because the local manager believes they can impact profits (because they can make critical decisions about how to serve the market, what products to sell, what advertising to buy and so forth) (Rajan, 1992) and so will work harder than if the benefit of all their hard work accrues to everyone evenly. For instance, local managers did a better job selling warranty plans when they were responsible for warranty claims (Dai, Zhou & Xu, 2012). Decentralization also permits the organization to evaluate local managers based on the performance of their ...

Solution provided by:
Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
Recent Feedback
  • "hey just wanted to know if you used 0% for the risk free rate and if you didn't if you could adjust it please and thank you "
  • "Thank, this is more clear to me now."
  • "Awesome job! "
  • "ty"
  • "Great Analysis, thank you so much"
Purchase this Solution
Free BrainMass Quizzes
Lean your Process

This quiz will help you understand the basic concepts of Lean.

Understanding Management

This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.

Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

Organizational Behavior (OB)

The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.

Learning Lean

This quiz will help you understand the basic concepts of Lean.

View More Free Quizzes
Related BrainMass Solutions

  • Baderman's

    Analyze the reason for the type of organizational structure employed by the organization; what are the pros and cons of this chosen type? For example is it centralized or de-centralized? Why? Are only certain functions centralized? Why?

  • Effective Cash Management in a MNC

    281017 Effective Cash Management in a MNC Discuss the pros and cons of a MNC having a centralized cash manager handle all investment and borrowing for all affiliates of the MNC versus each affiliate having a local manager who performs the cash management

  • Doing Business in Ireland

    Please prepare a report for your CEO and include the following: 1. As your CEO prepares to expand her operations globally, explain to him the pros and cons of each type of business: wholly owned, mergers, joint ventures, and acquisitions. 2.

  • A comparison of leadership and decision making styles.

    Higher education changes through a consensus-based environment (Kezar) while business organizations change through top-down management. discuss some pros and cons of each change process adding in your own experiences.

  • Pros and cons of leasing verses buying hardware

    267088 Pros and cons of leasing verses buying hardware Please provide the pros and cons of leasing verses buying hardware. What are some of the pros and cons of leasing verses buying hardware? Which would you prefer and why?

  • Comparing Various Management Approaches

    It is not well fit for police organizations per se, but having contingency plans is a necessity for any organization. Describe the total quality management approach, along with its pros and cons.

  • Pros and Cons of Outsourcing

    431691 Pros and Cons of Outsourcing What are some pros and cons of outsourcing? Would you outsource your/or any company? How might communication differ depending on the applied political approach to management decision making? Share an example?

  • Explanation for Capital Budgeting

    Capital budgeting assists in accepting and rejecting projects and decisions are made in line with strategic business plan. Pros and cons of: NPV Pros ? Takes into consideration the time value of money ?

  • Pros and cons of employers checking employee's references

    164627 Pros and cons of employers checking employee's references Can you explain to why the personnel records generally used by small and large organizations and what's the pros and cons of employers checking employee's references?

  • Economic Decisions: Tradition, Command and Market Economies

    98268 Economic Decisions: Tradition, Command and Market Economies What are economic decisions made in tradition, command and market economies and what are the pros and cons of each? Do any of these systems completely solve all economic problems?

View More Related Solutions