Answer (C) is correct . Decentralization is beneficial because it creates greater responsiveness to the needs of local customers, suppliers, and employees. Managers at lower levels are more knowledgeable about local markets and the needs of customers, etc. A decentralized organization is also more likely to respond flexibly and quickly to changing conditions, for example, by expediting the introduction of new products. Furthermore, greater authority enhances managerial morale and development. Disadvantages of decentralization include duplication of effort and lack of goal congruence.
Answer (A) is incorrect because When segments are autonomous, other segments are regarded as external parties, e.g., as suppliers, customers, or competitors.
Answer (B) is incorrect because Autonomous segments may have the authority to compete in the same markets.
Answer (D) is incorrect because Decentralizing decision making results in improved service. The managers closest to customers are making decisions about customer service.
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