Which of the following is true of a decentralized company?
A) In a decentralized company, lower-level managers are responsible only for implementing decisions.
B) In a decentralized company, overall profit margins can mask inefficiencies within various subdivisions.
C) In a decentralized company, the owner makes all important operating and strategic decisions.
D) Managers in a decentralized company make and implement fewer decisions than do managers in a centralized firm.
E) Local managers in a decentralized company can make better decisions using local information.

Question

​Which of the following is true of a decentralized company?
A) In a decentralized company, lower-level managers are responsible only for implementing decisions.
B) In a decentralized company, overall profit margins can mask inefficiencies within various subdivisions.
C) In a decentralized company, the owner makes all important operating and strategic decisions.
D) Managers in a decentralized company make and implement fewer decisions than do managers in a centralized firm.
E) Local managers in a decentralized company can make better decisions using local information.

Quizplus · Accepted Answer

In a decentralized company, decision-making is pushed down to local managers who have better access to local information. This can result in better decisions being made at the local level. Option A is incorrect because lower-level managers in a decentralized company have greater decision-making authority. Option B is incorrect because decentralization can actually expose inefficiencies and improve overall performance. Option C is incorrect because a decentralized company does not have a single owner making all decisions. Option D is incorrect because managers in a decentralized company make and implement more decisions than managers in a centralized company.

​Which of the Following Is True of a Decentralized Company

Which of the Following Is True of a Decentralized Company