After a report identified low employee morale, managers for Night and Day Inn, Inc. were concerned. Employee responses showed frustration with their inability to deal directly with customers' concerns and complaints. Employees feel that if they were empowered with the authority to make decisions, customer satisfaction would dramatically increase. This illustrates one of the disadvantages of decentralized authority.

Question

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This organization is an example of centralized authority with decision-making authority maintained at the top level of management at the company's headquarters. This usually results in less responsiveness to customers, the cause of the poor employee morale.

After a Report Identified Low Employee Morale, Managers for Night