Insight

Centralization versus decentralization

April 2016
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Organizational structure is notoriously difficult to design. The key functions or units to centralize remain a big challenge. However, centralization can bring with it many benefits such as: cost savings, standardization, and sharing of best practices.

At a glance

  • Although the pendulum may be swinging back toward decentralization, centralized structures still could offer significant costs savings.
  • Determining the right model is critical to any restructuring effort.
  • Businesses must consider the pros and cons of centralization versus decentralization, the various hybrid models, and then determine the most critical business processes.

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