Sunday, July 3, 2016

Centralization / decentralization movement and Brexit

While I was working on developing information systems for large companies several years ago, I was aware of a recurrent reorganization movement that was frequent in these enterprises. Sometimes, the organization was decentralized, meaning that branches or foreign or product units were largely independent from Headquarters; but then a re-organization occurred, with headquarters integrating the distributed units and dictating policies that everybody must follow. A few years later the units, possibly residing in several parts of the country, would complain that these policies were affecting sales, for instance, because Headquarters was not aware or sufficiently sensitive of local needs. Then a new reorganization occurred returning to the distributed organization, which a few years later was again reorganized to save supplier costs for instance, and so on...

During the many years that I had this kind of job I watched how organizations fluctuated between the more centralized and more distributed states several times. Sometimes this occurred at the level of the whole company, other times in a particular division or department.

In a recent talk by Eduardo Efren Nuñez Becuar at Monterrey, Mexico, he compared some aspects of Brexit with the American independence, and I was immediately reminded of this oscillation between centralization and decentralization.

England protests that Brussels policies are too restrictive and are affecting their economy, so they voted to leave the European Union: ironically, just the country that created the distributed Common Wealth does not want a Common Europe.  Concerns have been raised that Scotia, France and even the state of Texas will follow suit. But years before, the European Countries had agreed to form the more centralized Europe.

In 1776, the then colonies in North America decided to stage an independence revolution for Liberty, liberating themselves from the dictatorship of England... to sucumb later on to the more centralized dictatorship (?) of Washington.

Thus we see this movement from more distribution-more centralization at the level of organizations or of countries, and perhaps also at the level of families, when we grant more independence to our children only to pull the reins later on.

There should be something inherent in the way small and large groups of humans try to organize and reorganize themselves. The google query [centralization decentralization] brings in multiple references, 95% of them related to business entities; just a few for the political organization of countries and none for teams or families.