What are the advantages and disadvantages of Centralization?

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Centralization

Centralization in office can be defined as a process by which common office services or functions are centralized at one place-General Office. Again, office functions common to all sectional offices typing, filing, duplicating etc, are physically concentrated in one department known as ‘General Office’.

For example, if the duplicating service is organized as a separate department no other department is authorized to purchase its own duplicating machine. Under centralization, these common services are not arranged in the sections offices. It is the duty of the general office to provide the common services to all departments as and when they are required by them.

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Centralization of office services is desirable because it fixes responsibility on persons to do various jobs. It also avoids wastage and duplication of work and reduces cost of management.

Advantages of Centralization

The centralized arrangement of office services has the following advantages:

1. Duplication of work is avoided. It results in lowering the investment and maintenance cost of office machine.

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2. It is possible to bring specialization in the centralized department. It becomes feasible to employ people with specialized knowledge. The efficiency and output go up and the cost of office management is reduced.

3. The total volume of work can be distributed evenly among the central staff. Equitable distribution of work load is possible. None will be over-worked nor will any-one sit idle.

4. The same type of machines and equipments can be used by all the employees and the supervision leads to standardization of office procedures and methods.

5. It facilitates better and more scientific recruitment and training of employees.

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6. It facilitates and ensures greater flexibility in the use of staff, machines and equipment.

7. Constant dealing with the same type of work makes “The worker specialized and thus increases his efficiency and output and reduces cost of management.

Disadvantages of Centralization

The disadvantages of the centralization of office services are:

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1. The personnel in the central office unit may lack personal interest in the work of other departments.

2. The work of a department may be of a confidential nature and there is no guarantee that its secrecy will be maintained.

3. Centralization leads to frustration because of too rigid central control.

4. Work in the centralised office may be performed in that, order in which it is, received rather than in the order of its importance. This may result into less of business because of delay in the execution of orders.

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5. Handling of mail, file, etc. is quicker in decentralized system than in a centralized system.

6. While writing correspondence or doing other work for the departments the central staff may have to frequently refer paper back to the operating departments for clarifications. Thus there may be greater delay in performance of work.

7. The technicalities of a particular department may not be properly understood by the general office, resulting in frequent references, which lead to delay in the execution of work.

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