The advantages and disadvantages of centralised versus decentralised organisational structures lies greatly in the inherent qualities and effects of the structures themselves. Robbins and Coulter describe this very well, “If top managers make the organisation’s key decisions with little or no input from below, then the organisation is centralised.” Companies which wish to consolidate power and decision-making abilities at the top of the organisational chart, tend to be centralised organisations. If the CEO of a corporation has a particular vision and wishes for it to remain pure to his/her perspective, he/she will centralise the organisation so that he/she is able to control as much of the company as possible. As the textbook states, this is helpful for companies who need to be stable or are facing a crisis and need one source of decision-making to lead them. These sorts of organisations are becoming rarer, as employees become smarter and organisations become larger, however, a few do still exist. Consider the Oakland Raiders, a team which is widely acknowledged as being run completely (but poorly) by its owner, Al Davis or a monarchy such as Saudi Arabia, or an absolute theocracy, such as the Vatican City. Centralised structures are becoming rare because of their many disadvantages. Due to power being consolidated at the top of the organisation, the risk is great if the top of the organisation becomes incapable of leading the organisation (death, illness, or massive organisational size causing a weak span of control). Employees also will feel less motivated to perform for the organisation as they will not have an avenue for sharing their ideas on how to improve the organisation.
Decentralized organisations are becoming more popular as the ability for organisations to decentralise increases. Decentralisation allows organisations to take advantage of a division of labour by sharing decision-making across the organisation. It also empowers employees and allows them to improve their performance by being able to act to improve deficient or inefficient areas immediately without approval from the top of the organisation. Another advantage of decentralisation is allowing for the managers of business areas to actually use their first-hand knowledge and experience to improve their areas. Consider the Dallas Cowboys of the early 90’s, where Jerry Jones the owner had final say over all personnel decisions to the New England Patriots of today, where numerous individuals throughout the organisation have an input on personnel decisions. By trusting the individuals within the organisation to obtain accurate information and use their minds to provide appropriate analysis, the Patriots are able to take advantage of the division of labour and allows for multiple individuals to give input on players. Decentralisation has proven so successful for the Patriots (via seemingly always finding cheap players to replace expensive stars) that the Cowboys have now moved toward a more decentralised structure.
Immediately, apply decentralisation by allowing each division of my diversified food company to make decisions on the ingredients, manufacturing process, and almost all other aspects of each brand. I would allow the cookie experts to decide on what how and out of what to make the cookies. In my mind, many of the aspects of a food company correspond to an organic structure; for this reason I would encourage my managers to use teams, maybe based on each individual product, especially cross-functional teams that would work with all four food divisions to ensure that no one employee becomes bored by performing the same menial task over and over and allowing for all four divisions to be on the same page.
One area where a centralised structure would be considered is marketing. It would prove harmful to the salty snack foods and cookies brand if my breakfast cereals and fruit juice divisions decided to proclaim the health benefits of cereals and juice and expose the negative health aspects of eating too many cookies and salty snacks. Controlling the public image of the entire corporation would prove beneficial over a long-term outlook, even though it might take some of the ideas and unique marketing strategies out of the hands of the people who know them best.
Centralised vs. Decentralised
When you set up a records management program, you have to decide if you want a centralised or decentralised system. This refers both to where you store hard copy records and to the how you manage records.
Physical Arrangement There are many things to consider when you are setting up a new office or renovating an existing office space. One of the questions that you have to answer is where will you put the filling equipment? Will you have a central file room where all files will be stored? Will you have clusters of filing cabinets scattered around the office? Will you put filing cabinets in each office or cubicle? Your decision will be influenced by a number of factors. These include the floor strength of the building, the type of work that you do, and the confidentiality of the Centralised filing locations usually come in the form of a file room that serves the entire department or division. There are many benefits to having a centralised filing File rooms offer the most control and security over records. File room staff can make sure that access to records is limited to those who are authorised to see the records. File room staff can track which files are taken from the file room, and who has Filed are kept in one central location so that all employees know where to find their records. Duplication is reduced because a single central file is maintained, rather than multiple copies held by many employees. The drawback to centralised filing locations is that employees do not have files available to them at their fingertips. Some employees resist filing their records into a centralised filing system because it is not convenient. They may also feel a loss of control over Decentralized filing locations usually consists of clusters of filing cabinets, or filing stations, that are located around the office. In some cases, employees may have filing cabinets in their offices. Employees often prefer decentralised filing locations because their records are close at hand. Security and control over the records, however, is usually lower than in a staffed file room. In this kind of system, offices are more likely to have problems with duplicate records being stored in filing cabinets around the office. This happens because no one knows that the information exists somewhere else.
Centralised and Decentralized Control
In a centralised control model, one person or one group of people looks after the records management program. This person keeps track of which records are being created and where the records are stored. He or she also manages the scheduling and disposition of the records. There are many advantages to having a centralised control model:
One place to go for information on the records that the department has. A single point of contact in the department for all records management activities. A greater degree of consistency between different divisions and work units in the department. Greater control over the creation and distribution of information. More efficient management of records. Annual or periodic tasks, such as sending records to the Records Centre, are not put off. Centralised control models depend on the cooperation of all of the divisions in the department. Just as with centralised storage, centralised control may meet pockets of resistance in a department.
A decentralized control model is not a good model for managing records. In this kind of system, each work unit manages its records on its own. Individual work units may manage their records effectively, but there will be a lot of inconsistency across the department. Usually, there is also a lack of records management knowledge across the department. When problems arise, departments find that they have difficulty finding out where to get help or finding out how they should proceed to solve the problem. Consequently, problems tend to build on one another.