Differences between Centralization and decentralization

Point of difference	Centralization	Decentralization
Meaning	Concentration of power or authority at higher level only.	Even distribution of power and authority in every level of management.
Authority at different levels	Top level management retains maximum authority. The authority with middle and lower management is very low.	The authority is systematically divided at every level.
Needs	Full leadership and coordination.	Share the burden of the top level managers.
Suitability	Small sized organization.	Large sized organization.
Communication	Formal communication exists in the centralized organization.	Communication stretches in all directions in decentralization.
Time taken in decision making	Due to the concentration of powers in the hands of a single person, the decision takes time.	Proves better regarding decision making as the decisions are taken much closer to the actions.
Freedom of actions	Less freedom of actions to subordinates.	More freedom of actions to subordinates.
Conflict in Decision	Least likely to occur.	Most likely to occur.
Employee Motivation	Demotivated employee.	Highly motivated employee.
Burden	Only one group is carrying the burden.	The burden gets shared among many levels.
Stability	Relatively stable as decisions are made by a central authority sharing a common ideology.	Prone to instability due to multiple conflicting decisions.
When implemented	Organization has inadequate control over the management.	Organization has full control over its management.