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ACCA Strategic Professional · Strategic Business Leader · Enabling success: organising

Marlowe Foods, a family-owned manufacturer, has one owner-director who approves every purchase order, hiring decision and price change. As the firm opens three new regional plants, managers complain that decisions take weeks and local customers are lost. Which organisational change would most directly address this problem?

Delegating decision authority to regional plant managers within agreed limits is best. The firm suffers from over-centralisation, which slows decisions and harms local responsiveness. Decentralisation moves decisions closer to customers and operations, whereas more sign-offs or central purchasing would add delay and worsen the bottleneck.

  1. ADelegating decision authority to regional plant managers within agreed limitsCorrect
  2. BNarrowing the span of control of the owner-director by adding more review stages
  3. CMoving all purchasing to head office to improve consistency
  4. DIncreasing the number of written procedures requiring owner sign-off

Explanation

The problem is over-centralisation: all decisions pass through one person, so response to local conditions is slow. Decentralising authority to regional managers shortens decision time. Adding review stages or more sign-offs would increase centralisation and delay further.

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