- Asked 3/19
- 2067 Mangsir (old course) · 4 marks
- 2066 Magh (old course) · 4 marks
- 2064 Poush (old course)
Short note: Centralization and decentralization
Short answer
Centralization concentrates decision-making at the top for uniform policy and control. Decentralization delegates authority to lower levels for quick, on-the-spot decisions and initiative. Construction firms often balance both: policy at headquarters, daily site matters delegated.
Write a short note on centralization and decentralization.
Centralisation
Centralisation is the concentration of decision-making authority at the top of the organisation. Top management takes the main decisions; lower levels only carry them out.
Decentralisation
Decentralisation is the systematic delegation of authority and decision making to lower levels (branch, project or site managers), who can decide within the policy.
| Point | Centralisation | Decentralisation |
|---|---|---|
| Decision making | At the top | Spread to lower levels |
| Speed | Slow for far sites | Quick, on the spot |
| Uniformity of policy | High | Lower |
| Control | Easy | Needs a good control system |
| Initiative of managers | Low | High |
| Top management load | Heavy | Light |
| Suitable for | Small firm, crisis, uniform operations | Large, scattered projects |
In construction
A contractor with several projects usually delegates site matters (labour, daily purchase, work order) to the project manager (decentralised) but keeps the policy decisions such as tendering, big purchases and finance at head office (centralised). The best organisations use a suitable balance of both.
✓ Answer checked by Claude Opus 5.5 (high effort)