Question

In what ways are centralization, decentralization and coordination related to organization design? (Multinational business course) min 200 words

Answer 1

The centralisation , decentralisation and coordination , all three of them are the procedures applied in the organisation and help determining how tasks get accomplished in an organisation and have a integral part in deciding how efficiently the tasks will be conducted.

Centralisation and decentralisation decide the degree to which the power is vested in hands of top management or distributed among the lower levels. So it helps in determination of the design of organisation as it signifies the distribution of power , helps identify the framework of authority responsibility relation , work flow , scaler chain, communication flow and the outline of accountability-responsibility established which form the basis of organising staff , performing operations, taking decisions etc.

And coordination on the other hand ensures the existence of collaboration , cooperation and interdependence with the help of which the business will be able to operate as a systematic mechanism.

Moreover all three elements decide the dysfunctional aspect of performing jobs and demonstrate the policy or methodology of attaining objectives.

These elements form a prominent part in the establishment of organisational structure thus also playing a vital role in determining how the organisational design would look like. In fact the main component of organizational design is how tasks are accomplished which depends on decision making power which inturn is determined by the degree of centralization or decentralization in the organization.

Coordination demonstrates the level of synchronization of opetational activities and implementation of system approach to create dependancy and cooperation while tasks are accomplished which is also a significant part of organisational design.

The amount of centralised or decentralised a business is ,,,, depends on how much power and authority stays within the top management or is shared with the staff. This degree of centralisation or decentralisation helps outlining corporate culture , the form of communication flow , level of burden and decision making

Organizational design determines how relevant business functioning is to cope up with the dynamic environment in which the above three elements have a contribution in deciding the nature and procedure of performing tasks and realignment of operations to the business objectives.

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