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Which set of gains is claimed for decentralization?
AQuicker decisions, more innovation, more flexibility
BTighter financial control and less duplicated effort
CA broader view of operations held at the very top
DFewer competing objectives across the departments
Answer & Solution
Correct answer: A. Quicker decisions, more innovation, more flexibility
1. Decentralization can bring quicker decision-making and increased levels of innovation and creativity.
2. It also brings greater organizational flexibility, faster development of lower-level managers, and higher job satisfaction and commitment.
3. Tight financial control, removal of redundancy, and a broad view held at the top are the centralization case.
4. Competing objectives are a risk that decentralization increases rather than reduces.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 7 "Designing Organizational Structures", section 7.5 Degree of Centralization_
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