ECONOMICS

COST ACCOUNTING

TRANSFER PRICING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Which of the following is not a benefit associated with decentralization?
A
Quicker decision making
B
Increased motivation of subunit managers
C
Increased competition among managers
D
Greater responsiveness to local needs
Explanation: 

Detailed explanation-1: -Answer and Explanation: The statement that is not an advantage of decentralization is option D. Moving the sub-unit managers into the top-level management is a disadvantage to the company because the lower management will decrease and be lacking a workforce if that is so.

Detailed explanation-2: -Advantages of Decentralisation Decentralization improves the level of job satisfaction as well as employee morale, especially amongst the lower level managers. Furthermore, it strives to satisfy the varying requirements for participation, independence, and status.

Detailed explanation-3: -Conversely, decentralizing decision-making reduces delays, improves product development flow and throughput, and facilitates faster feedback and more innovative solutions. Higher levels of empowerment are an additional, tangible benefit.

Detailed explanation-4: -Disadvantages of decentralization include potential duplication of resources and suboptimal decisions, or decisions that are not in the best interest of the organization overall.

There is 1 question to complete.