Question

Companies that elect to decentralize their operations must resolve issues relating to

A. the tendency of managers to sometimes make decisions that are suboptimal from the company’s point of view.

B. the design of a measurement system that accurately reports on division performance.

C. all the above

D. the competency of the management of the divisions

E. none

Answer 1

C. All of the above

Analysis of the answer

A. the tendency of managers to sometimes make decisions that are suboptimal from the company’s point of view. - This is important as at times manager might be tempted to make decision which is good for his division but not for whole company.

B. the design of a measurement system that accurately reports on division performance. - Management system is really important

C. all the above

D. the competency of the management of the divisions - manager's competence is of utmost importance