What is decentralization? What is the importance of decentralization?
Answers
Answer:
The process of decentralisation makes the lower level managers question their judgement and abilities. When given responsibility and decision- making freedom, they are challenged to develop solutions. In the long run, this does a world of good to their confidence and promotes self-reliance.
MEANING OF DECENTRALIZATION
Decentralisation refers to the systematic effort to delegate to the lowest level, all authority except which can be exercised at the central point.
IMPORTANCE OF DECENTRALIZATION
i) Greatern motivation Decentralisation improves the morale and motivation of subordinates which is reflected in better work performance.
(ii) Develops initiative among subordinates Decentralisation helps to promote self-reliance and confidence amongst the subordinates. This is because when lower managerial levels are given freedom to take their own decisions, they learn to depend on their own judgement. It helps to promote initiative and creativity among them.
(iii) Develops managerial talent for the future As a result of decentralisation, employees get more opportunities to develop new skills. It makes them better future managers.
(iv) Quick decision-making Decentralisation in an organisation, provides more freedom to lower level managers to take their own decisions. There is no need to get approval from higher level. It helps in quick and better decision-making.
(v) Facilitates growth and expansion Decentralisation facilitates organisational growth through expansion and diversification. Top executives are not burdened by the administrative problems and complexities. So, they are able to plan expansion and diversification.
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