Question : Statement 1: Centralization can lead to bureaucracy and delays in decision-making.
Statement 2: Centralization empowers lower-level employees to make independent decisions.
Option 1: Statement 1 is true, and Statement 2 is false.
Option 2: Statement 1 is false, and Statement 2 is true.
Option 3: Both Statement 1 and Statement 2 are true.
Option 4: Both Statement 1 and Statement 2 are false.
Correct Answer: Statement 1 is true, and Statement 2 is false.
Solution : The correct answer is (a) Statement 1 is true, and Statement 2 is false.
Statement 1 is true. Centralization refers to concentrating decision-making authority at the top levels of the organization. In centralized structures, decision-making often involves several layers of approval, leading to potential bureaucracy and delays in decision implementation.
Statement 2 is false. Centralization involves concentrating decision-making authority at the top levels, limiting the autonomy and decision-making power of lower-level employees. Decisions are typically made by a few individuals at the top of the organizational hierarchy.
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