MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian

Apr 03, 2026 11:29 · 6:21 · English · Whisper Turbo · 2 & Kefluniañ
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Welcome to the session on Balancing Centralization and Decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
In this session, we will understand about the Balancing Centralization and Decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Centralization is an organizational setup whereby the authority to make important decisions
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
is retained by managers at the top level of the hierarchy.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Early management writers proposed that centralization in organization depended on the situation.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Their goal was the optimum and efficient use of employees.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Advantages of Centralization
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Standardization of procedures and systems.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It facilitates evaluation.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It facilitates economies of scale.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It ensures coordination of activities.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Disadvantages of Centralization
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It destroys individual initiative.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It overburdens a few employees.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It slows down the operations.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
If there is a distance from customers, there is no scope for specialization.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Decentralization
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Decentralization is an organizational setup whereby the authority to make important decisions about organizational resources
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
and to initiate new projects is delegated to managers at all levels in the hierarchy.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Organizations today have become more complex and responsive to dynamic changes in their environment.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Hence, the trend over the past several decades has been a movement towards more decentralization in organization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Advantages of Decentralization
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
There is an increased number of potential innovators.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It relieves the burden of the managers.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Preparing for emergencies.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It ensures more efficient decision making.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Disadvantages of Decentralization
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It makes coordination more difficult.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It causes conflict with ongoing operation.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
There is lack of uniformity in the policies followed.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It requires hiring of trained and qualified personnel.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It increases the financial burden on the organization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Deciding between centralization and decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Balancing these approaches can dramatically enhance process efficiency.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Centralization can expedite decision making in routine operations,
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
while decentralization has bring in innovative approaches for problem solving.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Factors to be considered
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
The following factors must be considered when deciding between centralization and decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Strategy and vision
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Size and complexity
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Culture and values
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Technology and systems
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
People and skills
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
And external environment
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
In the theory of organizational design,
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
The challenge in balancing centralization and mutual adjustment is to find a way of using roles and norms to standardize behavior while at the same time allowing for mutual adjustment to provide employees with the opportunity to discover new and better ways to achieve goals.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
In general, people at higher levels in the hierarchy and in functions that perform complex uncertain tasks rely more on mutual adjustments than on standardization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
You can see in this diagram the key differences between centralization and decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Striking a balance between centralization and decentralization and decentralization.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Striking a balance
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Before striking a balance between centralization and decentralization and decentralization,
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
The managers have to consider the advantages and disadvantages of both centralization and decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Break for questions
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Question number 1
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Following concept of organizing should be applied with caution.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Otherwise, it may lead to organizational disintegration.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
A.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Delegation
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
A.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Decentralization
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Centralization
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
C.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Decentralization
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
For authority
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
So the correct answer is Decentralization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Decentralization should be applied with caution because many people are involved in the decision-making process.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
They may make decisions according to their convenience.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Ultimately, it may result in the disintegration of the organization.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Question number 2
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Which factor influences the amount of centralization an organization uses?
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
A.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Complex environment
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
B.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Insignificant decision
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
C.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Risk of company failure
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
D.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Geographically dispersed the company
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
The correct answer is risk of company failure.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
When there is a high risk of company failure, the organization follows centralization of authority.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
It means the decision-making is in the hands of the top level of the hierarchy.
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S… Speaker 2 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
In this session, we have understood about the balancing centralization and decentralization.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Happy learning.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
Thank you.
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
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S… Speaker 1 (MBA_OB_unit 5_week 14_seq 4_Balancing centralization_Pandian)
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