{"id":1316,"date":"2014-02-10T07:00:48","date_gmt":"2014-02-10T06:00:48","guid":{"rendered":"http:\/\/embargo.ch\/AllBlog\/?p=1316"},"modified":"2017-02-14T13:54:55","modified_gmt":"2017-02-14T12:54:55","slug":"decentralize-or-centralize-why","status":"publish","type":"post","link":"https:\/\/embargo.ch\/AllBlog\/decentralize-or-centralize-why\/","title":{"rendered":"Decentralize or Centralize? Why?"},"content":{"rendered":"<p><BIG><strong>Why Decentralize?<\/strong><\/BIG><br \/>\n<strong>Wished outcomes:<\/strong><\/p>\n<ul>\n<li>&#8211; Flexibility in operations<\/li>\n<li>&#8211; Sensitivity to the client and the constraints<\/li>\n<li>&#8211; Empowered and accountable Professionals<\/li>\n<li>&#8211; Increase customer proximity<\/li>\n<li>&#8211; Approach internal services to users<\/li>\n<li>&#8211; Increase the time response<\/li>\n<li>&#8211; Countering the bureaucracy<\/li>\n<li>&#8211; Closer Service<\/li>\n<li>&#8211; Service more accessible<\/li>\n<li>&#8211; Better understanding of the constraints (link)<\/li>\n<li>&#8211; Information channel to the top executives<\/li>\n<\/ul>\n<p><img decoding=\"async\" src=\"http:\/\/sloanreview.mit.edu\/files\/2008\/12\/3822-ex2-lo7.png\" alt=\"MIT Decentralize or Centralize?\" \/><br \/>\n<SMALL><em>(http:\/\/sloanreview.mit.edu\/files\/2008\/12\/3822-ex2-lo7.png)<\/em><\/SMALL><br \/>\n<!--more--><br \/>\n<strong>Obstacles when decentralizing:<\/strong><\/p>\n<ul>\n<li>&#8211; Lack of skills (professional and management)<\/li>\n<li>&#8211; Top executive Anxiety<\/li>\n<li>&#8211; Political Pressure<\/li>\n<li>&#8211; Need for complex coordination<\/li>\n<li>&#8211; Running Costs, including coordination<\/li>\n<li>&#8211; Needs of interdependence (transverse)<\/li>\n<\/ul>\n<p><strong>Errors when decentralizing:<\/strong><\/p>\n<ul>\n<li>&#8211; Decentralize more than necessary &#8230;<\/li>\n<li>&#8211; Lack or failure of coordination mechanisms<\/li>\n<li>&#8211; Specialty Logic (silos)<\/li>\n<\/ul>\n<p><strong>Intrinsic conditions for decentralization:<\/strong><\/p>\n<ul>\n<li>&#8211; Maturity of actors<\/li>\n<li>&#8211; Skilled players<\/li>\n<li>&#8211; Mechanisms for complex coordination<\/li>\n<li>&#8211; Informal Networks<\/li>\n<li>&#8211; Safe staffing<\/li>\n<li>&#8211; Volume of activity sufficient<\/li>\n<li>&#8211; Policies \/ procedures well done<\/li>\n<li>&#8211; Operational Guidance vs . bureaucratic<\/li>\n<\/ul>\n<p><strong>Risks when decentralizing:<\/strong><\/p>\n<ul>\n<li>&#8211; Bursting, rupture<\/li>\n<li>&#8211; Lack of consistency<\/li>\n<li>&#8211; Balkanization (closing small empires)<\/li>\n<li>&#8211; Ambiguity re authority<\/li>\n<li>&#8211; Ambiguity \/ displacement loyalties<\/li>\n<li>&#8211; Secrecy (blackmail)<\/li>\n<\/ul>\n<p><BIG><strong>Why Centralize?<\/strong><\/BIG><br \/>\n<strong>Wished Outcomes:<\/strong><\/p>\n<ul>\n<li>&#8211; Facilitate the global coordination<\/li>\n<li>&#8211; Increase compliance with institutional norms<\/li>\n<li>&#8211; Increasing security<\/li>\n<li>&#8211; Economies of scale<\/li>\n<li>&#8211; Supplementing the possible limited staff skills<\/li>\n<li>&#8211; Accelerate operational decisions<\/li>\n<li>&#8211; Improving the quality of business decisions<\/li>\n<li>&#8211; Facilitate real-time adaptation<\/li>\n<li>&#8211; Motivate staff operations<\/li>\n<\/ul>\n<p><strong>Direct Earnings:<\/strong><\/p>\n<ul>\n<li>&#8211; Increased and easier business control by executives (orientations)<\/li>\n<li>&#8211; Security for the &#8220;stakeholders&#8221;<\/li>\n<li>&#8211; Simple Coordination<\/li>\n<\/ul>\n<p><strong>Intrinsic conditions:<\/strong><\/p>\n<ul>\n<li>&#8211; Legitimate Authority<\/li>\n<li>&#8211; Competence content from leaders<\/li>\n<li>&#8211; Mechanisms \/ effective communication tools<\/li>\n<li>&#8211; Small or mechanistic organisation<\/li>\n<\/ul>\n<p><strong>Risks:<\/strong><\/p>\n<ul>\n<li>&#8211; Bureaucratic , inertia, slow<\/li>\n<li>&#8211; Secrecy<\/li>\n<li>&#8211; Inadequate Decisions<\/li>\n<li>&#8211; Increased costs of system<\/li>\n<\/ul>\n<p><em>ref: Pierre Collerette MBA&#8217;s HEC course<\/em><\/p>\n<!-- AddThis Advanced Settings generic via filter on the_content --><!-- AddThis Share Buttons generic via filter on the_content -->","protected":false},"excerpt":{"rendered":"<p>Why Decentralize? Wished outcomes: &#8211; Flexibility in operations &#8211; Sensitivity to the client and the constraints &#8211; Empowered and accountable Professionals &#8211; Increase customer proximity &#8211; Approach internal services to users &#8211; Increase the time response &#8211; Countering the bureaucracy &#8211; Closer Service &#8211; Service more accessible &#8211; Better understanding of the constraints (link) &#8211; [&hellip;]<!-- AddThis Advanced Settings generic via filter on get_the_excerpt --><!-- AddThis Share Buttons generic via filter on get_the_excerpt --><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[376,30,353],"tags":[432,381],"class_list":["post-1316","post","type-post","status-publish","format-standard","hentry","category-information-management","category-management","category-techno-management","tag-management","tag-mba"],"_links":{"self":[{"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/posts\/1316","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/comments?post=1316"}],"version-history":[{"count":9,"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/posts\/1316\/revisions"}],"predecessor-version":[{"id":1329,"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/posts\/1316\/revisions\/1329"}],"wp:attachment":[{"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/media?parent=1316"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/categories?post=1316"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/embargo.ch\/AllBlog\/wp-json\/wp\/v2\/tags?post=1316"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}