This Question: 1 pt Decentralization divides company operations into various rep

Question

This Question: 1 pt Decentralization divides company operations into various reporting units. Most decentralized subunits can be described as one of four different types of responsibility centers 1. Explain why companies decentralize. Describe some typical methods of decentralization 2. List the four most common types of responsibility centers, and desoribe their responsiblites Requirement 1. Explain why companies decentralize Describe some typical methods of decentralization Companies usually decentralize when they Decentralization is often based on: Ito masp the odro oganzation's daly operations. Requirement 2. List the four most common types of responsibility centers, and describe their responsibilites Choose from any drop-down list and then continue to the next question. 2 3 4. 5 6

Explanation / Answer

Decentralization is a type of organizational structure in which daily operations and deciaion making responsiilities are delegated by top mannagement to middle and lower levwl managers within the organization,allowing top management to focus more on major decisions.For small businesa,growth may create the need to decentralize to continue efficient operations.

Decentralization offers several advantages,though relinquiahing control may be difficult for a business owner accustomed to making all the decisions.

Empowering employees:

Employees can be empowered by having more autonomy to make their own decisons,giving them a sense of importance and making thwm feel as if they have more input in the dirwction of the organization.It also allows them to make better use od the knowledge and expeeience theey have gained some of thwir own ideas.

Releiving the burden:

Decentralizing takes some of the burden of daily business operations of the business owner.When thw owner allows others to perform auch tasks as horing new employees or ordering supplies,this frees her to spend more time on big picture items,such as planning for expansion or meeting with important clients

Preparing for emergencies:

A situation may arise where the business owner must be away feom the business for an extend peeiod time because of illness or another type of emergency.

More efficient decision making:

It is able to make decisons more quickly than one with a centralized steucture

Ease of expansion:

It can facilitate the process of expansion

2.There are 3 types of decentralization

A.deconcentration

B.delegation

C.devolution

3.There wre 4 types of responsibility centres

a.cost centres-responsible for controlling costs

B.revenue centres-responsible for generating revenue

C.profit centres-responsible for generating profit through controlling costs and generating revenue

D.investment centres-responsible for generating profit and efficiently managing the division's imvested capital or assets

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