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Decentralisation

Decentralisation distributes decision authority to lower levels or units rather than retaining it centrally. It can use local knowledge, speed decisions and develop managers, but can duplicate resources and create conflicts with group objectives. Define which decisions are delegated and align measures, information and rewards with that authority. A divisional structure can be decentralised to different degrees, and not all operational choices need the same level of autonomy.

Worked example

Regional managers set local promotions while major capital investments remain centrally approved.

Common mistake

Decentralisation is not the same as geographic dispersion or separate legal incorporation, and it does not eliminate coordination needs.

Where it appears in your exams

QualificationExamRelationshipPeriod
ACCA APM Direct September 2026–June 2027
ACCA BT Direct September 2026–June 2027
ACCA PM Direct September 2026–June 2027
ACCA SBL Direct September 2026–June 2027
FIA FBT Direct September 2026–June 2027