*Control by one man*: the case for and against centralised control

What the statement means

The statement praises one-man control, in which a single person takes all the decisions, but it attaches a condition: the arrangement is the best only if that person is able enough to handle every matter personally. In the language of organising, this is an argument about centralisation. An organisation is centralised when the higher levels keep the authority to decide, and decentralised when that authority is delegated to lower levels. Read in this way, the statement says that concentrated control works well where the person at the top has the capacity for it, and it implies that it breaks down once that capacity is exceeded.

When control by one person works

• Speed and secrecy. A sole proprietor decides promptly because no one else has to be consulted, which lets the business act on a market opening in time; sole authority also lets the owner keep business information confidential.
• Uniform policy. Those who value consistency favour centralised authority, because a single centre of decision is the easiest way to treat all customers and suppliers alike on quality, price, credit and service.
• Costly decisions. As a general rule, the more expensive an action, the more likely it is to be decided at the upper levels.
• Owner-built firms. Enterprises that expand from within, or under their owner-founders, show a marked tendency to keep authority at the centre.

A family sweet shop in Old Delhi, where the owner buys the milk and sugar, fixes prices and watches the counter personally, can run very well on one person's judgment, because the business is still small enough for one mind to take in.

Why one person cannot manage everything

The condition in the statement is rarely met for long.

• No one excels at everything. A sole proprietor has to look after buying, selling and financing alike, and it is rare to find an individual who is good at all of them, so decisions may not always be balanced.
• Limited capacity to supervise. There is a limit to the number of people a manager can supervise effectively, because a manager's physical and mental capabilities are limited.
• Slow decisions. Where every decision is taken at the top, information has to travel through many levels, which slows decision making and makes it hard for the enterprise to adapt to changing conditions.
• Growth in size. The larger the organisation, the more decisions it must make and the more places it must make them in, so it needs a greater degree of decentralisation. Employees close to an operation often know more about it than a top manager who is only indirectly connected with it.
• Total centralisation is unrealistic. Keeping every decision at the apex would remove the need for a hierarchy of managers altogether, and no organisation can work that way.

Balancing centralisation and decentralisation

No organisation can be wholly centralised or wholly decentralised; every organisation has elements of both, and the need is to balance them. Decentralisation unburdens top managers, places decisions nearer the point of action and builds training, morale and initiative at the lower levels; yet total decentralisation, with no coordination and leadership from the top, would also be undesirable. For this reason the real question for managers is not whether to decentralise but how far to go. A growing pharmacy chain in Tamil Nadu, for example, may let store managers set staff rosters and local displays while head office alone decides new store openings and the borrowing to pay for them.

Conclusion

The statement holds only within its own condition. One-man control gives speed, secrecy and uniformity while the business is small enough for one person to master. As it grows, no single individual is big enough for everything, and a planned degree of decentralisation becomes necessary.