Decentralization, goal congruence, responsibility centers. Hexton Chemicals consists of seven...

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Decentralization, goal congruence, responsibility centers. Hexton Chemicals consists of seven independent operating divisions. The operating divisions are assisted by a number of support groups, such as R&D, human resources, and environmental management. The environmental-management group consists of 20 environmental engineers. These engineers must seek business from the operating divisions— that is, the projects they work on must be mutually agreed to and paid for by one of the operating divisions. Under Hexton’s rules, the environmental group is required to charge the operating divisions for environmental services at cost
1. Is the environmental-management group centralized or decentralized?
2. What type of responsibility center is the environmental-management group?
3.What benefits and problems do you see in structuring the environmental-management group in this way? Does it lead to goal congruence and motivation? Explain.

David · Accepted Answer

Quetion 1). 
 a)The environmental -management group appears to be decentralised because its  
managers have considerable freedom to make decisions.
b)They can choose which projects to work on and which projects to reject.
c)Top management will adjust the size of the environmental management group to match the demand for the group's services by operating divisions.

Decentralization, goal congruence, responsibility centers. Hexton Chemicals consists of seven independent operating divisions. The operating divisions are assisted by a number of support groups, such...

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