Some of the major advantages of decentralization are as follows:
(1) It reduces the burden of top managers especially when the institution is large or is expanding. The top manager can then concentrate on planning for future while delegating operating decision on self-contained departments/sections headed by competent managers.
(2) It motivates subordinates for higher performance. It promotes initiative, responsibility and morale of subordinates through consistent and adequate delegation of managerial work.
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(3) It promotes employee participation and enthusiasm on account of freedom and challenges offered to them.
(4) It paves the way to better decisions. Since most of the decisions are made by people directly involved in operations, such decisions are likely to be more realistic.
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(5) It facilitates managerial development. It encourages the development of generalists, facilitating succession into the position of general managers. In a centralized structure, departmental managers (HODs or vice-principals) become narrow specialists in their individual spheres of work.
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(6) It facilitates diversification of institution on the basis of curriculum (SSC/ISCE/CBSE), faculty (Arts/Science/Commerce), level of education (Junior and Senior College, Primary and Secondary school) and so on.
(7) It secures better co-ordination of all activities within a self-contained unit/department/section.
(8) It facilitates control due to small span of management where performance can be measured against a specific standard.
Few Disadvantages of Decentralization:
(I) It increases cost of operation because each unit needs to be self-sufficient in terms of infrastructural facilities.
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(2) There could be a problem of policy control in that each unit may have its own policy different from other units.
(3) Top management may get isolated from ground realities.
(4) There is a tendency towards disintegration if too much latitude is given to heads of individual units.