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Decentralization and Centralization of power

Updated on 05 February 2021
7 min read 29 views
Updated on 05 February 2021

Students of management studies always ask one question. What is decentralization of power? Well, Decentralization of power can be defined as the activities done by the employees of the organization. The employees of the organization are given the power to take decisions and other tasks. The concerned authorities do not have any say in this. The concept of decentralization can be applied to the management of the organization.


What is decentralization in government?

It basically refers to the reduction of the government taking part in the decision–making policies and many others. The concerned authorities sometimes think that there are certain responsibilities that would be handled best at a regional level. Decentralization is important as people can take part in local affairs. Citizens can make decisions regarding various things like whom to vote, what community party they want in the near future and much more.

What is decentralization in Management? Decentralization in management refers to the distribution of power at the middle or lower levels of the organization. The employees are given the liberty to make decisions for several things in the organization. Decentralization at the management level can be seen when the minor decisions are taken by the employees and the major ones are left to the higher authorities. This somehow reduces the burden of the concerned authorities thereby leading to the efficient working of an organization.


Advantages of Decentralization

Decentralization can be effective in many ways in management. The distribution of power can lead to the smooth working of an organization. Let us look at the various advantages of decentralization below:

1. Reduction of burden: 

Decentralization leads to the segregation of power which reduces the burden from the top authorities. As a result, the top management can focus on various other things in the organization. Moreover, the employees are also motivated as they are given the authority to take minor decisions which thereby increases the efficiency of the organization.

2. Better Supervision:

Decentralization leads to better supervision in the organization. The lower and middle-level subordinates take decisions depending upon their interests. As a result, the employees can have a better knowledge of the tasks that they are provided. The employees are also given the authority to make changes as and when they like which in turn boosts their confidence. 

3. Decision – Making:

When the powers are distributed among the employees, they are able to make quick decisions regarding the projects that they are provided. Since the employees do not have to ask the higher authorities, this leads to quick decisions and amendment of the changes made. 

4. Diversification of Products:

Decentralization enables the company in having diversified products, activities and employees. There are different kinds of products and activities taking place in the organization. Therefore, employees can scrutinize the activities taking place in the organization, thereby making the necessary changes. 

These are some of the advantages related to decentralization. Decentralization can increase the efficiency of the employees by providing them motivation which will help in boosting their confidence. The above – mentioned points can also be considered as some of the features of decentralization.      

What is centralization and decentralization? Many times, students get confused between these two terms. Decentralization refers to the distribution of power among the lower and middle-level subordinates so that the top management can take the major decisions and work on making new policies for the betterment of their employees. On the other hand, centralization can be defined as the higher authorities taking all the major and minor decisions regarding the organization.   

Centralization increases the burden upon the higher management thereby leading to inefficiency in the organization. The employees will not be willing to work in a strict environment. The employees want some liberty and freedom which is possible in decentralization. Thus, centralization and decentralization have different meanings and implications.

What is the importance of decentralization in government? The authorities governing the nation distribute the powers at a regional or a local level. This leads the higher authorities taking major steps in developing the economy. As a result, the citizens take active part in the events happening in the nation at a regional level. The citizens are provided the liberty to take minor decisions for the nation thereby, leading to brotherhood and harmony.

Thus, decentralization can lead to an effective nation and management where the employees are satisfied with the liberty and freedom that they are given.  

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