A variety of factors can influence the extent to which a firm is decentralized. In principle, neither decentralization nor centralization is right or wrong. Wide and Narrow Spans of Control. A wide span of management exists when a manager has a large number of subordinates. A narrow span exists when the manager has only a few subordinates.
Several factors determine the span that is better for a particular manager.
Organizational height is the number of layers, or levels, of management in a firm. The span of management plays a direct role in determining the height of the organization. If spans of management are wider, fewer levels are needed and the organization is flat . In a taller organization, administrative costs are higher because more managers are needed. Communication among levels may become distorted.