Decentralizing Decision Rights Marries Authority with Local Knowledge

question 41

Multiple Choice

Decentralizing decision rights marries authority with local knowledge.This would seem to be a good thing,but a problem that may arise is that:

• A)local management may conserve central management's time and effort.
• B)local knowledge may allow local managers to tailor prices and services to suit local needs.
• C)lack of local incentives may mean that local managers do not work to maximize firm value.
• D)local managers may have too strong a corporate identification.

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Definitions:

Rational-legal

Rational-legal is a term often used to describe a form of authority or governance system where power is legitimized by legally enacted rules and regulations, as opposed to tradition or charismatic leadership.

Statutes

Written laws enacted by a legislative body that govern a society or state.

Codes of Conduct

Sets of rules outlining the responsibilities, ethical standards, and proper practices for individuals or organizations.

Political Action Committees (PACs)

Groups of people who organize to support candidates they feel will represent their views.