decentralized business intelligence definition

However, the enterprise expects them to commit fewer and less-critical mistakes. It is not that high-level managers do not commit mistakes. Therefore, even in a decentralized organization, these decisions are made in a centralized manner. While the degree of decentralization depends on a wide range of factors which are different for different organizations, here is a common list: Significance of the decisionĭecisions which are costly either in terms of money, goodwill of the company, employee morale and other such decisions which are significant to the organization are centralized at the top-levels of the organization. Formal Organization- Matrix Organizationįactors determining the Degree of Decentralization.Formal Organization- Project Management Organization.Formal Organization- Line and Staff Organization.Formal Organization- Functional Organization.Next, let’s look at the factors that determine the degree of decentralization. Even if an organization is working in a decentralized manner, some functions are usually centralized. Since managers can see the results of their own actions, they are more driven and have improved morales.īoth centralization and decentralization have their own advantages and disadvantages.Provides good exposure to mid and lower-level managers and creates a pool of promotable manpower with managerial skills.Offers a democratic environment where employees can have a say in their governance.Faster decision-making and better quality of decisions.It offers a better control over the activities of the organization by ensuring consistency in operations and uniformity in decision-making.The organization has a better chance of utilizing the potential of its outstanding employees.It can help in the elimination of overlapping or duplicate activities and save costs.The organization can strictly enforce uniformity of procedures and policies.

Let’s take a quick look at the advantages of centralization and decentralization: Advantages of Centralization Unlike delegation, it is not just about handing over a part of the authority to a subordinate but a way of approaching the decision-making process in the organization.ĭecentralization is a choice, while delegation is a must.

A decentralized way of working is more about the philosophy of the organization. An organization has a greater degree of decentralization if the number of decisions made and functions affected at the lower level are higher.įurther, while decentralization and delegation of authority might seem similar, you must not confuse one with another.

Decentralized business intelligence definition