Question

In what ways are centralization, decentralization and coordination related to organization design?

Answer 1

Centralization is a sort of organizational design that involves decision making and planning within an organization. A head office has al the decision-making authorities and the other offices receive commands from the head office.

Decentralization in organizational structure which includes the everyday operations as well as the decision-making responsibilities to be delegated by the top management to the lower tier and the mid-tier organizations. Therefore, it allows the top management to focus on the major decisions.

Coordination is an organizational design that includes incentive mechanisms, information systems, decision systems, and control systems of an organization and the way they are implemented, managed, and controlled within an organization.