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Unit 5: Coordination, Centralisation and Decentralisation

manifold if the interaction has to be between the members of varied teams. Here comes the role Notes
of coordination.
Coordination is the act of coordinating, making different people or things work together for a
goal or effect. Obviously, a manager has to be adept in the art of coordination.
Centralisation, or centralization (see spelling differences), is the process by which the activities
of an organisation, particularly those regarding decision-making, become concentrated within
a particular location and/or group.
Decentralisation is an extension of the concept of delegation and cannot exist unless authority is
delegated. In decentralisation, a great deal of authority is delegated and more decisions are
made at lower levels. It gives added responsibility to managers at all levels below the top.

According to Fayol 'everything which goes to increase the subordinate's role is decentralisation,
everything which goes to reduce it is centralisation'.

5.1 Coordination

According to Mooney and Reiley, "Coordination is the orderly arrangement of group efforts to
provide unity of action in the pursuit of a common purpose."
According to Henry Fayol, "To coordinate, means to unite and correlate all activities".

According to McFarland, "Coordination is the process whereby an executive develops an orderly
pattern of group efforts among his subordinates and secures unity of action in the pursuit of
common purpose."

On the basis of the above stated definitions, we can state the following as the essential elements
of coordination:
1. Coordination implies deliberate efforts to bring fulfillment of goal.

2. Coordination applies to the synchronised arrangement of the productivity of a group and
not any individual.
3. Coordination is needed only when there is an involvement of a group over a task. It
would not be required if an individual were to work in isolation.
4. Coordination is a continuous effort which begins with the very first action, the process of
establishment of business and runs through until its closure.
5. Coordination is necessary for all managerial functions. In organising work, managers
must see that no activity remains unassigned. In staffing, managers must ensure the
availability of competent people to handle assigned duties. In directing organisational
activities, managers must synchronise the efforts of subordinates and motivate them
through adequate rewards. In controlling organisational activities, managers must see
that activities are on the right path, doing right things, at the right time and in the right
manner. Thus, coordination transcends all managerial functions.

5.1.1 Need for Coordination

The need for coordination arises from the fact that literally all organisations are a complex
aggregation of diverse systems, which need to work or be operated in concert to produce
desired outcomes. In a large organisation, a large number of people process the work at various
levels. These people may work at cross purposes if their efforts and activities are not properly
coordinated. To simplify the picture, one could decompose an organisation into components
such as management, employees, customers, suppliers and other stakeholders.

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