A Behavioral Interpretation of Decentralization Chapter 12 Dian

A Behavioral Interpretation of Decentralization Chapter 12 Dian Indri, SE. , M. Si

Decentralization reasons 1. 2. 3. 4. 5. 6. Manager focusing for decision Quick response Complex information To management facilities Autonomy needs Size dominant Dian Indri, SE. , M. Si

Research 1. Reducing transaction cost 2. Quick response availability, stability, and concentration environment resources 3. Organization face on conflict and changing - specific information - quick response - innovative behavior Dian Indri, SE. , M. Si

Decentralization 1. Divided Tasks & decision - Production Marketing Finance, dll 2. Resources accountability - Cost centers - Revenue centers - Profit centers - Investment centers Dian Indri, SE. , M. Si

Developing A Charter Requirement activity delegation Decentralization reasons: Special talent Reach specific economic scale Specific activity uniformity Decision making process quickly Behavior norm Dian Indri, SE. , M. Si

Behavior norm communication: Socialization norm introduction Specialization professionalism Standardization standardize Formalization written norm Decentralization transfer pricing 2 unit, type: » » » Market prices Cost plus Variable cost Negotiated transfer prices Arbitrated prices Dian Indri, SE. , M. Si

Measuring & Evaluating Performance Final step in decentralization system setting for evaluation and reward Goal congruence ROA Fairness » Single measurement vs multiple performance » Financial vs nonfinancial measurement » Output or behavior measurement Dian Indri, SE. , M. Si