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Understanding Management Structures: Centralized vs Decentralized Control

Management structure refers to how a firm is controlled and operated, influenced by business size, type, and ownership philosophy. Centralized control features a flat structure where the general manager retains significant decision-making power. In contrast, decentralized control allows greater delegation but less oversight. Smaller businesses often adopt more centralized structures due to their limited hierarchy, while larger firms may benefit from decentralization to manage diverse operations. Factors such as staff size, assets, and ownership influence the optimal management structure.

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Understanding Management Structures: Centralized vs Decentralized Control

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  1. Producers Management Structure

  2. Management Structure Refers to the way in which a firm is controlled, operated run. This will often depend on the: • Size of a business, • The type of business • The philosophy of its owners

  3. Centralised Control This type of management structure allows the general manager to have more control over the business decisions. It could be described as a flat management structure

  4. Decentralised Control This type of management structure allows more delegation but less control

  5. Which type of Structure? A smaller business would have a …………………………………………………………………. Why? A larger business would have a …………………………………………………………………….. Why?

  6. If unsure….. Consider the size of a business • No. of Staff • Physical Size • Turnover/Sales • Assets • Ownership – How many owners, issues of conflict & expertise. • Liability – Need for more control….

  7. Onslow…? What kind of Management Structure do we have at Onslow?

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