Question

Explain the meaning of Fayol’s principle of centralisation.

Answer 1

Centralisation refers to the concentration of power or authority. In some organizations, this power is vested in one hand or few hands. This situation occurs in small organizations. But if the size of the organization is large then centralization becomes difficult. According to this principle, there must be a proper balance between centralization and decentralization in the organization. This is to be done according to the size of the organization, nature of the activity etc.