Manage Centralization Through Decentralized Command

Larger organizations provide better structure and resources. However, the larger the organization, the more necessary it becomes for governance to be centralized and for control to be top down, in order to manage the chaos. Taken too far, governance of the organization becomes authoritarian and tyrannical. In addition, it is impossible for those in command to know everything and make informed decisions, since they are far removed from the ground.

Smaller organizations are more agile and are able to innovate better. However, they may suffer from a lack of clear structure and hierarchy. They may not have access to the requisite resources at large scales to bring certain ideas to fruition or support them. Taken too far, small organizations are chaotic and unable to produce anything of significance.

Both ends have their advantages and disadvantages. The ideal structure for large organizations may be to have decentralized command, where there is an overarching centralized governance structure that sets the direction and delegates action to smaller, decentralized groups nested within that are empowered to make their own decisions under the constraints set by the top chain of command. This offers a balance between centralization and allowing smaller groups that are decentralized to remain agile, where these smaller groups still have access to the structure and resources of a large organization, promoting greater innovation.

An example of this kind of system in practice is how the United States is governed. Each state has autonomy and self-governance. However, these states are all united under the federal government. As a result, each state has its own strengths and character, while still benefiting from protection under the federal government through the military.

References

Extreme Ownership by Jocko Willink and Leif Babin

Guns, Germs, and Steel by Jared Diamond