Identify a disadvantage of decentralization of operations.
A) Managers do not have the scope to become experts in their area of operation.
B) Managerial creativity and customer relations are hampered.
C) Managers closest to the operations are not allowed to make decisions.
D) Decisions made by one manager may negatively affect the profits of the company.

Question

Quizplus · Accepted Answer

Decentralization of operations means that decision-making is delegated to lower-level managers who may not have a holistic view of the company's operations. This can lead to decisions that benefit their specific area of operation but negatively affect the overall organization's profits or goals. Hence, the disadvantage of decentralization is that decisions made by one manager may negatively impact the company's profitability or success. The other options are not necessarily disadvantages of decentralization.

Identify a Disadvantage of Decentralization of Operations