What is centralization in an organization?

Centralization in an organization refers to the concentration of decision-making authority at the top levels of management. It is a hierarchical approach where key decisions are made by a few individuals or a central authority rather than being distributed across different levels or departments. Centralization ensures that important decisions are made by individuals with the necessary expertise and experience, which can lead to greater efficiency and consistency in decision-making. However, it can also result in slower response times, reduced innovation, and limited employee autonomy, as lower-level employees have limited decision-making power. The degree of centralization in an organization can vary, with some organizations adopting a more centralized approach while others opt for a more decentralized structure.

This mind map was published on 23 July 2023 and has been viewed 128 times.