Decentralisation in Plant Engineering

What is Decentralisation?

Decentralisation is open to a number of interpretations. In administration, it may be used to refer to

a. Departmentalizing activities

b. Location of actual performance or

c. The dispersal of the centres of authority and decision making at various levels in the organisation.

Centralisation is the systematic and consistent reservation of authority by the top management or the management at the centre (say, in the case of an organisation comprising branches) while decentralisation consists in the dispersal of authority. It must be remembered that complete centralisation is impossibility because a management is impossible without some measure of delegation of authority. Likewise, complete decentralization involving freedom (in place of autonomy) for the various divisions or departments will amount to virtual disintegration. Between these two extremes where the authority is largely concentrated at the top and mostly the authority to execute given plans is given to the personnel at lower levels, the organisation is said to be centralized.

On the other hand, where much of the authority to plan, direct, execute and control is passed down the organisation and the top management is concerned with broad planning and control, it is described as a condition of a high degree of decentralisation. We are here concerned fundamentally with decentralisation in Plant Engineering Department in the sense of the systematic effort to delegate to the lowest levels of all authority except that which can be exercised at central points. In other words, decentralisation here refers to the dispersal of the centres of decision-making throughout the organisation.