Organizational Geography and

Decision Making

Jeremiah Pacer
Political Science Department
MA Public Administration
Rizal Technological University
 Organizational Geography:
Centralization and Decentralization

 An organization has to make strategic and operational

decisions. Where and by whom should these decisions be
made? And: how should the organization structure be
adapted? Centralization and Decentralization are two
opposite ways to transfer decision-making power and to
change the organizational structure of organizations
accordingly.
 Organizational Geography:
Centralization

 The process of transferring and assigning decision-making

authority to higher levels of an organizational hierarchy.
 In a centralized organization, the decision-making has been moved
to higher levels or tiers of the organization, such as a head office, or
a corporate center.
 Knowledge, information and ideas are concentrated at the top, and
decisions are cascaded down the organization.
 The span of control of top managers is relatively broad, and there
are relatively many tiers in the organization.
 Organizational Geography:
Decentralization

 The process of transferring and assigning decision-making authority to

lower levels of an organizational hierarchy.
 In a decentralized organization, the decision-making has been moved to
lower levels or tiers of the organization, such as divisions, branches,
departments or subsidiaries.
 Knowledge, information and ideas are flowing from the bottom to the top
of the organization.
 The span of control of top managers is relatively small, and there are
relatively few tiers in the organization, because there is more autonomy in
the lower ranks.
 Organizational Geography:
Strengths of Centralization

 Philosophy / emphasis on: top-down control, leadership, vision, strategy.

 Decision-making: strong, authoritarian, visionary, charismatic
 Organizational change: shaped by top, vision of leader.
 Execution: decisive, fast, coordinated. Able to respond quickly to major
issues and changes.
 Uniformity. Low risk of dissent or conflicts between parts of the
organization.
 Organizational Geography:
Strengths of Decentralization

 Philosophy / emphasis on: bottom-up, political, cultural and learning

dynamics.
 Decision-making: democratic, participative, detailed.
 Organizational change: emerging from interactions, organizational
dynamics.
 Execution: evolutionary, emergent. Flexible to adapt to minor issues and
changes.
 Participation, accountability. Low risk of not-invented-here behavior.
 Centralized Command Decentralized Command

Sample Cases: Graph of Organizations

Cross Reference: Fayol
 Decision Making:
Scope and Reach

 Each Decision of any importance is the product of an intricate

process of brokerage involving individuals inside and outside the
organization who feel some reason to be affected by the decision, or
who have special knowledge to contribute to it.
 Decision Making:
Progression of Steps in Decision Making

 (1) Recognition of the problem;

 (2) Collection of data;
 (3) Classification and analysis of data;
 (4) Preparation of an inventory of means for realizing their objectives;
 (5) Listing of alternative solutions;
 (6) Evaluation of these alternatives;
 (7) Making of the decision;
 (8) Implementation; and
 (9) Obtaining feedback on the results obtained with it.
 Decision Making:
Groupthink

Groupthink
 Mode of thinking that people engage in when members’ strivings
for unanimity override their motivation to realistically appraise
alternatives of action
 Decision Making:
Symptoms of Groupthink

Symptoms
 (1) Feeling of invulnerability- the group must be right and will triumph;
 (2) Collective efforts to rationalize in order to discount warnings which
lead the members to reconsider their assumptions
 (3) Complete faith in the group’s inherent morality;
 (4) Stereotyped views of enemy leaders as evil, weak or stupid- and
therefore easily outwitted;
 Decision Making:
Symptoms of Groupthink

Symptoms
 (5) Direct pressure on dissenters within the group for them to show the
proper loyalty;
 (6) Self-censorship of deviation from the apparent group consensus- the
member swallows his or her doubts;
 (7) Shared illusion of unanimity concerning judgments conforming to the
majority views-everybody is presumed to be in agreement; and
 (8) Emergence of self-appointed mindguards- members who protect the
group from adverse information that might shatter their shared
complacency.
 Decision Making:
Common Errors in Decision Making

 Cognitive Nearsightedness
 Assumption That Future Will Repeat Past
 Oversimplification
 Overreliance on One’s Own Experience
 Preconceived Notions
 Unwillingness to Experiment
 Reluctance to Decide
 Decision Making:
Some Factors Influencing Decisions

Outside Decisions
 If administrators are constantly making political decisions, abstract logic
cannot realistically be proposed as the model for all governmental decision
making. This simply means that decision-making procedures cannot be
shaped independently of the real world.
 Decision Making:
Some Factors Influencing Decisions

Sunk Costs
 Previous investments of money, other resources and time- explain much of
the organizational inertia and conservatism. If substantial sums have already
been invested in the program, administrators often stubbornly persist with it
despite the overwhelming evidence that the original decision was wrong and
should be changed. More is involved than the loss in money; long-established
modes of conduct have been built around the existing policy. Frequently, the
official is convinced that a little more effort will produce the desired results.
MARAMING SALAMAT PO!