Distinguish between centralisation and decentralisation.
Difference between centralisation and decentralisation:
| Basis of Difference | Centralisation | Decentralisation |
|---|---|---|
| Meaning | The retention of power and authority with the top level of management is known as centralisation. | Dispersal of powers and authority to various levels of management is known as decentralisation. |
| Communication Flow | The flow of communication in centralisation is vertical. | The flow of communication in decentralisation is open and free. |
| Decision Making | The decision making process is slow in centralisation. | The decision making process in decentralisation is comparatively faster. |
| Power of decision making |
Power of decision making lies in the hands of only the top level of management. | Power of decision making lies in the hands of various level of management. |
| Work load | There is a higher workload on the top level managers. | There is less workload. They share authority and responsibility. |
| Suitable for | It is suitable for small sized organisations. | It is suitable for large sized organisations. |
| Creativity | It restricts the creativity of middle and lower level managers. | It promotes creativity and innovation at all levels of management. |
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