Centralization and Decentralization

Centralization occurs when certain office activities/services are concentrated in one department.
For example, if the office activity of filing is centralized this will mean that all filing matters are
dealt with in one location, usually under the supervision of someone who is a specialist in filing.
All other departments in the organization would need to go to this centralized filing office to deal
with all their filing needs.

Decentralization occurs when office activities are carried out in each individual department. For
example, if filing is decentralized this will mean that each department within the business will
have its own filing system accessible to its staff.

Examples of office activities that will be centralized or decentralized include:

duplicating/reprographics the process of making copies from an original document;

filing;

typing and word processing;

mailing;

legal services;

recruiting.

The decision to centralize or decentralize activities will depend on the size of the business as
well as the nature of the tasks being done. Small firms usually have one general office and may
not be divided into departments. However, medium-sized and large firms which are divided into
departments are better able to make decisions regarding centralization and decentralization.
Businesses may also be able to use both centralization and decentralization for example, a firm
may centralize filing and legal services because of their sensitive nature, while it may
decentralize duplicating and word processing.

Advantages of centralization

The staff will be specially trained to carry out their functions and will be able to operate
relevant equipment correctly.
 Noisy equipment will be housed in one place.

Supervision of the task will be improved and accountability maintained.

The tasks performed will be standardized.

Costs will be minimized for example, instead of purchasing photocopiers for each
department, a few copiers may be bought for one duplicating/ reprographics office.

Disadvantages of centralization

There may be a delay in work, for example if duplicating is centralized, when a worker from
the Sales Department needs to make copies of a document they will have to go to the Duplicating
Office which could be far away.

The staff may find their jobs repetitive and boring.

Advantages of decentralization

Work can be carried out quickly, as equipment needed is close by.

It allows for the maintenance of privacy.

Disadvantages of decentralization

There may be a duplication of work throughout the various departments.

Costs may be increased as equipment will need to be provided for the various departments.

Office layout

The office layout looks at the amount of space provided in the work environment as well as
how desks, chairs and furniture and resources are placed in the office.

The two main forms of office layout are the open-plan layout and the enclosed layout.

The enclosed layout is also referred to as a traditional or cellular layout. It includes rooms
where employees work by themselves or in small groups. The enclosed layout will be enclosed
by walls and accessible by a door.
 The open-plan layout is a large open area where employees work together in one integrated
office. In the open-plan layout there is no privacy and workers are able to see and communicate
with each other freely. In order to create some privacy in an open-plan layout, sound-proof
screens or dividers can be used to separate the employees.

Factors determining the choice of office layout

There are a number of factors that help to determine whether a business will choose to use
an open-plan or enclosed layout:

the number of employees in the organization a business with a large number of employees
may choose to use an open-plan layout;

the amount of space that is available;

the type of work to be done for example, companies which have to discuss sensitive
information may choose to use an enclosed layout while an advertising agency might choose an
open-plan layout in order to facilitate creativity;

the amount of money available.

Advantages of the enclosed layout

Allows employees to have greater levels of privacy, for example to meet with clients.

Employees are able to work in peace and quiet and concentrate on their tasks without
interruption.

The office may be locked, providing security for confidential information as well as valuable
possessions.

Employees within the enclosed layout can organize the office the way they want for example,
they can choose where to place their desk.

Employees will also be able to personalize their space for example, with family photographs

Disadvantages of the enclosed layout

This layout does not encourage teamwork.

Security devices, such as panic buttons, may need to be installed to protect the occupant of the
office, who may be alone most of the time.

There is poor utilization of space, as walls take up space that could have been efficiently
organized into an open-plan layout to hold more people.

Increased supervision is needed to ensure that workers are actually doing their jobs behind the
closed door.

There will be increased maintenance costs because of elements such as separate air-
conditioning and lighting to run the enclosed office.

Advantages of the open-plan layout

Communication is easier as all the workers are in one area feedback will be immediate.

Teamwork is encouraged and friendships are developed.

Workers are easily supervised as they are all in one area.

The open-plan layout is more cost effective in terms of bills such as cooling and lighting. For
example, one large room being centrally cooled by air conditioning will be cheaper than having
to place air-conditioning units in several offices.

The layout can be re-arranged, if needed, quickly and with little effort.

Virtual office (e-workplace)

Unlike traditional office layouts, such as enclosed and open-ended, the virtual office is a
company that does not have a physical location and whose employees work remotely by
computer e-mail, groupware software, and other communications technology. Many employees
in a virtual office work from home, however, the virtual office can be accessed from anywhere,
including a hotel or a car. Working from home via telecommunications is known as
telecommuting.

If necessary, a virtual office can rent a Post Office (PO) box if it needs items to be delivered
to it. Conference rooms can also be rented in cases where meetings need to be held.
 Virtual receptionists can also be hired when needed, to carry out tasks such as screening and
forwarding telephone calls.

Advantages Disadvantages
1. it is cost effective costs such as rent and 1. the lack of face-to-face communication
electricity will be eliminated; may lead to miscommunication;
2. it increases the firms flexibility; 2. workers may lack team spirit, because of
feelings of separation and isolation;
3. employees can be hired irrespective of 3. workers may experience technical
their physical location. difficulties with their equipment.

Table 1.1 Advantages and disadvantages of the virtual office

Other variations of the traditional office are hoteling and hot-desking.

Hoteling is a work arrangement where the office includes providing unassigned desks or
cubicles which employees who work from home (telecommuters) can reserve for specific periods
of time when needed.

Hot desking is a work arrangement where employees are not given their own desks, but
instead there are specific sets of desks or cubicles that are fully equipped, with computers
connected to the firms network and telephones, which will be used when needed. Hot desking is
suitable for workers who travel a lot and do not visit the office often, such as journalists and
sales representatives. Hot desking is similar to hoteling except that reservations do not need to be
made.