User talk:Shanzz

An answer to your question about decentralisation in business: in general, businesses that use franchising (e.g. many fast food chains, and some retail chains like Bokia in Sweden) let franchisees make most local decisions and instead control the business through distribution of products and branding. Another example in banking would be the savings bank alliances that have sprung up in (for example) Norway, allowing small local savings banks to share the costs of IT development and some products (like investment products) while remaining locally run.

From an economics perspective a decentralised company is interesting. Ronald Coase famously defined companies (firms) as miniature planned economies. His argument was that they exist because transaction costs and other market failures mean that it is not efficient to use market mechanisms everywhere, so firms grow until their internal planning (e.g. Henry Ford owning the steel mills which supplied his car factories) is no longer more efficient than the open market (buying in steel from outside suppliers).

Nowadays the distinction between the centrally-planned firm and the competitive market is being blurred: Bokia and Handelsbanken deliberately limit their central planning because local market-based decisionmaking under the umbrella of their brand makes them better businesses. At the same time, car companies like Toyota buy parts from outside suppliers but develop very close relationships with them and are often their only customer. Tamino (talk) 20:29, 29 August 2011 (UTC)