One decision all organizations must make is how power and
decision-making authority must be shared. As discussed in
Chapter 7, organizations may either be centralized,
decentralized, or a combination of both, when it comes to who
makes the decisions.
Think of an organization with which you are familiar. This may
be somewhere you have worked, a non-profit with which you
have been associated, or even your own family unit.
How is decision-making authority distributed in this
organization?
Is this the most efficient method of decision-making in
this instance? Why or why not?
Would you recommend the organization redistributes
decision-making power in a different way? If so, what
potential benefits would this have to the group?
The organization that I am choosing is New Horizon Cuisine (hereafter referred to as NHC). NHC is best
described as a decentralized organization.
Bateman (2019) describes a decentralized organization as an
organization in which lower-level managers make important decisions. Because of NHC’s small size and
rapid growth, authority has been delegated to several members of the staff to keep operations running
efficiently. The delegated authority allows for the ability to respond quickly in case of any setback. While
those managers each have particular focuses, they have all been cross-trained to run the plant
completely on their own if necessary. While this decentralized approach can lead to confusion from time
to time, it is the best situation for the company at this point in its growth. Whenever a disagreement
arises, the managers have a meeting to achieve consensus. Because of the nature of the operation, it
takes years to train new employees to be able to run the equipment and understand the processes.
There are too many simultaneous operations for NHC to revert to a centralized organization in which one
person would try to make all of the decisions. As NHC continues to grow, it will need to evaluate if its
current organization chart continues to be effective.
Reference:
Bateman, T. S., Snell, S. A., & Konopaske, R. (2019).
M: Management
(6
th
ed.). McGraw-Hill.
