For a business to succeed, it must achieve its objectives and goals. An organization's objectives act as a guiding tool that provides direction. Therefore, a business needs to align and motivate employees to achieve the set objectives. A company can encourage employees to achieve the objectives by adequate communication, motivation, and reward. Some businesses are more successful in achieving their goals than others attributed to the organization leadership structure- either centralized or decentralized. In a centralized management system, an individual makes all essential business decisions, whereas decentralized management allows different people to participate in the decision-making process (Minas et al., 2012).
I used to work as a cashier in a small enterprise that specialized in selling modern bedding both in retail and wholesale. This organization was quite successful because it had gained a competitive advantage over its competitors due to most of the employees' incredible customer service. The company used a centralized management structure as the owner was responsible for making all the decisions. He then conveyed his decision and strategies to employees to implement them. Although the organization recorded good performance, most employees were never motivated to achieve the organization's goals. They did not feel like a part of the objectives plan.
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Consequently, the centralization structure limited the company to explore its maximum potential and thrive exceptionally in the market. Furthermore, some employees felt that they had better strategies to enhance the company's goals. Unfortunately, they were not allowed to participate in the decision-making process.
From a personal perspective, I prefer decentralized organizations over centralized ones. The decentralized management structure increases the chances of company expansion because different people give ideas that may challenge the organization to explore new fields, subsequently enhancing growth. In a centralized system, the owner or CEO may not have new ideas, thus limiting growth. Additionally, decentralized organizations increase employees' morale thus, improving overall performance. Employees are better motivated to work toward the organization's goals when they are allowed to participate in the decision-making process.
References
Minas, R., Wright, S., & van Berkel, R. (2012). Decentralization and centralization. International Journal of Sociology and Social Policy .
