Chapter 10, Problem 1Q

What is meant by the term decentralization?

To determine

Decentralization:

It refers to the process of delegating authority and tasks to lower levels of management instead of being accumulated at the middle or top level management.

Decentralization has several benefits such as increased employee productivity and motivation as well as acting as an incentive for personal and professional growth.

Meaning of the term Decentralization.

Answer to Problem 1Q

Solution:

Decentralization is the process of disbursing authority and tasks to those who are at lower levels in the organizational hierarchy.

Explanation of Solution

• Centralization refers to the process of accumulating the authority and responsibilities at a central point. In an organization this can be seen in the form of corporate responsibilities and authority being given to a select few in the top management.

• However, this practice leads to overutilization of mental faculties and can lead to a drop in the performance of the employees at the top management level as they may feel overburdened.

• This also affects employees at the middle and lower management level of the organization since it results in a lack of incentive to perform and shoulder organizational responsibilities.

• Decentralization takes care of this problem by ensuring delegation of work to those at middle and lower levels of management and making them accountable for the same.

• This can result in efficient utilization of resources, pooling of mental faculties of people at the same level, and also acts as an incentive to perform better.

• Decentralization refers to the process of delegation of the authority and responsibilities from a central point to lower levels in the organizational structure.

• In an organization this can be seen in the form of corporate responsibilities and authority being given to the middle and lower level management.

• Decentralization is also practiced in other fields such as political science, economics, team dynamics in personal and professional situations

Conclusion

Hence it can be seen that the process of delegation of the authority and responsibilities from a central point to lower levels in the organizational structure is Decentralization.