BASIS CENTRALIZATION DECENTRALIZATION

MEANING Centralization of authority Decentralization refers to the

means the power of dissemination of powers by the
planning and decision top management to the middle or
making are exclusively in low-level management.
the hands of top
management.
Involves Systematic and consistent Systematic dispersal of authority.
reservation of authority.

Communica Vertical Open and Free

tion Flow

Decision Slow Comparatively faster

Making

Advantage Proper coordination and Sharing of burden and

Leadership responsibility

Power of Lies with the top Multiple persons have the power of
decision management. decision making.
making

Implement Inadequate control over the Considerable control over the

ed when organization organization

Best suited Small sized organization Large sized organization

for

Employee Significantly faster Comparatively slow

Motivation
Stability Prone to instability due to Relatively stable as decisions are
multiple conflicting decisions made by a central authority sharing
a common ideology