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Divisional autonomy

Divisional autonomy is the decision authority given to a division over matters such as pricing, sourcing, operations or investment. It can improve local responsiveness and accountability but requires coordination and measures promoting group objectives. Authority and responsibility should align; a manager cannot fairly be assessed as if fully autonomous when head office dictates key decisions. Autonomy can vary by decision rather than being completely present or absent.

Worked example

A division may choose external suppliers but need central approval for large capital projects. Its performance report should reflect that boundary.

Common mistake

Do not assume decentralisation permits every local decision regardless of group strategy or that an imposed transfer price leaves full sourcing autonomy.

Where it appears in your exams

QualificationExamRelationshipPeriod
ACCA APM Direct September 2026–June 2027
ACCA PM Direct September 2026–June 2027