·        Continuous feedback loops allow smaller teams to make decisions which govern their work in a quicker fashion than presenting feedback from one dedicated function within a centralised organisation to one or more dedicated functions to formulate a response or adaptation for the whole organisation, which is then sent up the committee tree for consideration by senior management and/or the Board for consideration and approval.

·        Processes being established and implemented by smaller teams allows greater understanding of the influences and impacts of the processes on the team’s desired outcomes.

·        Tailored measurement provides local insights into the performance of the team which in turn allows better adaptation to achieve outcomes for customers or stakeholders which are directly impacted by processes.

Though the centralised model favours consistency of output across teams and managerial line of sight, for overall organisational viability the decentralised model services customers or stakeholders better which would in theory lead to better outcomes for the organisation.

Agile organisations with decentralised decision-making encourage higher levels of engagement as teams are directly involved in setting goals associated with shifting the dial on various issues, giving them a sense of ownership over the identified problems, and associated solutions. Psychological safety is essential to ensure the timeliness and accuracy of feedback loops (bad news should travel as fast as good news). Employees who are at the coal face are also much more likely to understand the root cause of problems, and thus co-design processes to improve the likelihood of progressing to the desired goals.

A clear central strategy needs to be broad-enough for each area to define their particular strengths and contributions to the organisational output upon which viability depends, while being specific enough to maintain an overarching organisational coherence.

When it comes to measurement, the main challenge is to balance each of these inputs to the whole, when they are very different. For example, the difference between HASS and STEM: one Faculty might deliver significant student revenue, but less research revenue (albeit undertaken at lower cost), while another requires more infrastructure inputs to teach fewer students, but attracts significant external research funding. The two contribute to the whole, but shared KPIs tend to blur the important differences and can lead to centralised target setting devoid of context.

In systems thinking terms, this means that high-level organisational feedback loops are typically not nuanced, and underlying problems can be overgeneralised, leading to unbalanced performance expectations.

Further, strict centralised rules for budget management and expense criteria can restrict innovation across each sub-organisational unit, and/or impose costly and slow bureaucratic approval processes.

However, too much decentralisation in large and complex regulatory environments can amplify risk which can threaten overall viability.

This assumes a large, complex and geographically dispersed organisation operating across multiple sites that must maintain regulatory compliance while remaining responsive to local community needs. Centralisation provides consistency, accountability, risk management and compliance, while also reducing duplication of work through shared processes, resources and standards. Decentralisation enables local adaptation, faster decision-making and responsiveness to changing circumstances and stakeholder needs.

From a systems thinking perspective, viability is enhanced when there are clear central controls and common objectives, but local teams are empowered to respond to feedback and adjust processes within defined boundaries. This balance supports both efficiency and consistency, while maintaining the flexibility needed to meet diverse local requirements.