Centralised and Decentralised Structures Flashcards

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What is a centralised structure?

Most decisions are made at head office by top managers.

What is a decentralised structure?

Decisions are shared out to local managers or teams.

Give one benefit of a centralised structure.

Decisions are the same across all branches.

Give one drawback of a centralised structure.

It can be slow to meet local customer needs.

Give one benefit of a decentralised structure.

Local managers can act fast for their customers.

Give one drawback of a decentralised structure.

Choices may differ between branches.

Which structure gives stronger control from the top?

A centralised structure.

Which structure can raise staff motivation, and why?

Decentralised, as staff get more say and responsibility.

How can centralisation help cut costs?

The firm can buy in bulk and avoid doing the same work twice.

When is decentralisation most useful?

When the firm has many sites with different local needs.

How does centralisation affect decision speed in branches?

It can slow choices, as staff must wait for head office.

When might a business prefer centralisation?

When lower managers lack experience and big choices are risky.