Centralization (economics)

In business organization theory , centralization is understood to mean the grouping together of identical or similar tasks , work areas or areas of responsibility to a central point.

species

This center point can be interpreted as the center. A distinction must be made accordingly:

The Verrichtungszentralisation , operational tasks summarizing, which like chores underlie such. B. Procurement Tasks .
The phase centralization , in which tasks are coupled that serve the purpose of planning , implementation and control , e.g. B. in financing .
The Entscheidungszentralisation as a summary of operational decisions to a central point.
The administrative centralization , in which certain dispositive tasks are coupled, e.g. B. Human Resources Functions .

aims

The centralization pursues the goal of increasing the efficiency of the processes involved and reducing redundancies . One can approach this goal through spatial as well as factual centralization. The efficiency-increasing effect of centralizing measures can be reduced by longer decision-making paths and additional decision-making levels. Strategic realignments are easier to implement; the middle management level has fewer opportunities to engage in micropolitical behavior.

The opposite approach is decentralization , i.e. distributing different areas of responsibility to many locations or positions . Depending on the type of company, there may be a tendency towards centralization or decentralization. A decentralized organization allows greater freedom, flexibility and market proximity. This form can also be more ethically-friendly, as responsibility is less shifted to superiors, remote headquarters or fixed bureaucratic structures. Innovative industries can benefit from this.

Marxism

The centralization of capital is an important tendency of capitalist economies for Karl Marx . What he means is that the number of companies is decreasing as large companies swallow up small ones or by company mergers . In today's language, capital centralization roughly corresponds to relative concentration . The centralization of capital is closely linked to the law of the tendency of the rate of profit to fall .

literature

K. Bleicher : Centralization and Decentralization. In: E. Grochla (Ed.): Hand dictionary of the organization. 2nd Edition. Stuttgart 1980, Col. 2405-2418.
E. Frese: Fundamentals of the organization. 10th edition. Wiesbaden 2012
W. Krüger: Organization of the enterprise. 4th edition. Stuttgart 2004
K. Marx: Capital. Critique of Political Economy. First volume, Berlin 1966.

Individual evidence

^ Günter Beuermann: Centralization and decentralization. In: Erich Frese (Hrsg.): Concise dictionary of the organization. 3. Edition. Stuttgart 1992, Col. 2611 ff.
^ Klaus Olfert, Horst-Joachim Rahn: Compact training organization. 7th edition. Herne 2015, p. 80 ff.
^ Karl Marx, Das Kapital , Volume 1, Berlin 1966, pp. 654 ff.

[1] Günter Beuermann: Centralization and decentralization. In: Erich Frese (Hrsg.): Concise dictionary of the organization. 3. Edition. Stuttgart 1992, Col. 2611 ff.

[2] Klaus Olfert, Horst-Joachim Rahn: Compact training organization. 7th edition. Herne 2015, p. 80 ff.

[3] Karl Marx, Das Kapital , Volume 1, Berlin 1966, pp. 654 ff.