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</center><center><sup>Source: [Canva](https://canva.com)</sup></center>
Hello everybody,
This is @cryptogecko. I hope everyone is doing well in their lives and I wish you a more prosperous future.
For this assignment task given by professor @yousafharoonkhan, I chose to focus on the second question. Our discussions will focus on the implications of decentralization in all fields that it has been associated with recently. Our discussion will also include an analysis of the advantages and disadvantages of decentralizing the general business environment systems.
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Q1. Define decentralization?
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According to Wikipedia article, the definition of a decentralised system is:
> “Decentralization or decentralisation is the process by which the activities of an organization, particularly those regarding planning and decision making, are distributed or delegated away from a central, authoritative location or group.” [Wikipedia](https://en.wikipedia.org/wiki/Decentralization)
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</center><center><sup>Source: [Canva](https://canva.com)</sup></center>
When a decision-making process is centralized, the power is concentrated in very few hands. It is top management that approves all decisions and actions taken by the lower levels as well as all tasks and issues assigned to the lower levels.
According to [Louis Alexander Allen](https://en.wikiquote.org/wiki/Louis_A._Allen),
> “Centralization” is the systematic and consistent reservation of authority at central points in the organization. Source: [Medium](https://medium.com/@mtcore_/pros-and-cons-of-centralization-and-decentralization-1fbffb6efffb)
Centralization can result in the following consequences:
1. Power to make decisions is reserved for the top.
2. Middle-level managers receive operating authority.
3. The top level of the organization reserves the right to direct the lower level of the organization.
Centralization means that top managers make critical and important decisions, and workers follow their directions in implementing those decisions. When a father and son own a business, for example, they decide what's important, while the remaining areas, such as sales, finance, and marketing, are handled by the department heads, who follow the father and son's orders. Therefore, it appears that the decision-making powers belong to the father and son in this case.
Meanwhile, decentralized administration involves systematic delegation of authority in the organization at all levels. Decentralized organizations have top management that has the authority to make major decisions and establish policies that affect the entire organization. Additionally, the remainder of the authority can be assigned to lower-level management.
In other words, the amount of authority delegated to the lowest level measures decentralization and centralization.
"Decentralization," according to [Louis Alexander Allen](https://en.wikiquote.org/wiki/Louis_A._Allen), is referred to as the systematic process of delegating authority to the lowest levels of the organization, except when central control and oversight are possible.
Despite the fact that decentralization and delegation do not necessarily go together, the two concepts are in many cases interchangeable. One of the main purposes of decentralization is extending delegation. An example of decentralization is when power is distributed and is directed at the lowest level.
As part of the delegation process, authority is transferred from one party to another. Decentralization is considered complete when delegation is carried out to the fullest extent possible.
A corporation's general manager, for example, handles requests for leave on behalf of the entire company. The general manager delegated this responsibility to the personnel manager, who now has to deal with leave applications. It is evident in this instance that authority has been delegated. Alternatively, if the general manager delegated this power to all the department heads at all levels upon request of the personnel manager, we would have seen decentralization at work.
With this approach, we achieve decentralization and distribute responsibility more widely. Although delegation allows managers to hold their subordinates accountable, they are still accountable for their subordinates’ actions.
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Q2. Describe the advantages and disadvantages of a decentralized system.
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As the business environment changes in the digital age and with the internet of things, top management is no longer the only player in decision making. As corporate management becomes increasingly professionalized and the business world becomes more globalized, decentralization has become an essential element of growth for a company. You can decide whether decentralization is suitable for your company or organization after examining its pros and cons.
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#### <center>Advantages of Decentralization</center>
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* **Efficiency during an emergency:** You should consider decentralization when faced with an emergency. A decline in sales might require more efficient use of resources, cost-cutting, elimination of competition, etc. As a result of decentralizing, managers don't have to deal with everything themselves, and no one person is held responsible for it all.
* **Keeping track of all activities is made easy:** It becomes very simple to organize work and keep all activities on track through decentralization. The decision-maker has a direct line of communication with employees, thereby facilitating faster decision-making. This enables making more accurate and wiser decisions.
* **Diversification of activities:** Rather than having chief executives take routine decisions, managers at the middle levels are permitted to do so. CEOs can focus their efforts on important business goals such as diversifying their product lines and setting up new production lines.
* **Development of Managers:** In a growing business with a high demand for managers, decentralization provides a training ground for future managers. As a result, it helps develop new managers for the growing business.
* **Increased morale and productivity:** Developing management skills in a decentralized setting results in an increase in productivity as well as higher morale within the staff.
* **Benefits to the community:** The social net product may become better as a result of decentralization, separate from the company's benefits. Having greater freedom of action, lower social hierarchies, and the ability to participate constructively could benefit people in the long run.
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#### <center>Disadvantages of Decentralization</center>
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* Decentralization, while offering many advantages, also poses some challenges and limitations. Below are some of the disadvantages that come with decentralization:
* If there are external factors such as strikes in the organization, decentralization may not be possible.
* Administrative expenses increase since there must be skilled managers at many levels who are highly paid.
* There is no uniformity among different departments since managers make their own decisions based on their insight and capabilities.
* Decentralization is not a viable option for small businesses, as their operating expenses exceed any benefits they might be able to obtain from it.
* The efficiency of a decentralized system depends on the manager who oversees that department. Without the skills or competence to make the right decision, it is possible for an organization to incur heavy losses.
* Every department may become self-centred rather than focusing on the general interests of the organization.
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Q3. In what areas of life can a decentralized blockchain be helpful?
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Blockchain technology is now being used to record and verify a wide range of digital transactions - and it is being used across a variety of fields. The use of blockchain technology for cryptocurrency and banking is just the earliest application. Applications of blockchain are being seen in industries as diverse as insurance, gaming, and cannabis.
Blockchain technology is boosting awareness in sectors as diverse as public policy and infrastructure due to its ability to increase transparency and reliability throughout the digital information ecosystem. Several innovative ways companies are utilizing blockchain technology include the following:
1. **The law of wills & inheritances**
An ideal use case for a blockchain smart contract solution would be wills, which are a type of contract that is highly specific. In addition to carrying out the deceased's wishes, litigation related to wills often seeks to establish the "genuineness" of the will, or whether the legal interpretation conforms to what the deceased intended.
Although blockchain technology will not completely eliminate these problems, it could help determine factual information, create a record of transactions that can be verified, and assist in dismissing unfounded claims.
2. **Transportation by ride-sharing**
Ride-hailing apps like Uber and Lyft essentially operate as dispatching hubs and use algorithms to manage their fleets of drivers (and set their prices), hence being the opposite of decentralizing. A blockchain technology-based marketplace combining riders and drivers will create a more user-friendly, value-based market where both parties can collaborate and share information.
3. **The air travel industry**
Booking a flight requires a lot of information, including names, birthdays, credit card numbers, immigration details, a destination, and sometimes even hotel or car rental details, depending on how the flight is booked.
A safer and more convenient journey for travellers can be provided by blockchain technology's ability to provide data reconciliation and security. In comparison to a physical ticket, digital tokens provide an added layer of security. Smart contracts provide airlines with a way to control and verify the sale and usage of their tickets so they can provide customers with a verified experience. The system assists in improving aircraft maintenance records, preventing overbooking, and performing other tasks.
4. **The construction, architecture, and building industries**
Construction companies frequently work on complex and highly regulated projects that involve a wide range of tradespeople. Verifying their identities, the quality of their work, and their dependability can be challenging and time-consuming. The implementation of a blockchain-based ecosystem would simplify the process of verifying identities and tracking progress for multiple teams, which would help address this challenge.
Furthermore, blockchain technology may simplify automatic payments related to project milestones in addition to ensuring construction materials are sourced from the right locations and are of high quality.
5. **The public transportation system**
Many cities are growing rapidly, placing tremendous pressure on their transportation systems, which can be extremely inefficient and expensive.
Cities may be able to better understand public transportation usage with the help of blockchain-based systems.
6. **Management of waste**
Recycled material is one of the most effective ways to reduce landfill waste, but it is a labour-intensive and time-consuming process that may not produce many benefits. It would be possible to improve recycling processes by integrating blockchain technology with existing recycling systems.
7. **Loyalty programs & gift cards**
By utilizing blockchain technologies, retailers can create more secure and cost-effective loyalty programs and gift cards. The use of blockchain-based gift cards reduces the need for middlemen in the issuing of gift cards and the transfer of sales, so they become more efficient and cost-effective.
Unique verification capability offered by blockchain reduces costs and protects the integrity of accounts by helping to prevent unauthorized users from gaining access to them.
8. **Agriculture & crop production**
Using blockchain technology in agriculture could solve the safety and traceability concerns addressed in the context of food and beverages. In terms of transactions, markets expansion, and product-specific logistics, the agriculture supply chain could be improved with a decentralized blockchain system.
As a blockchain ledger enables a record of transactions, it can help promote trust among merchants who may not otherwise be acquainted. A blockchain-based record can also serve to promote healthy competition among sellers and expand the market.
9. **The education & academic sector**
Recognized transcripts are a fundamental requirement of academic credentials. In primary and secondary schools, as well as in universities, academic credentials are verified manually (primarily using paperwork and case-by-case checking).
Through the implementation of blockchain solutions in education, the verification process could be simplified, reducing the likelihood of fraudulent claims for unearned credits.
10. **The gaming industry**
Gaming online has increased exponentially in popularity, and the industry has become a competitive sport with coveted titles, major prizes, and even a black market for buying and selling games.
By using blockchain technology, we can level the playing field for gamers, allowing them to compete, win rewards, and exchange assets between digital universes. Blockchain can be used to exchange digital tokens for cryptocurrency securely and without the involvement of third parties.
With the help of the blockchain's distributed ledger, gamers can use their digital avatars or characters in different digital worlds. Rather than relying on central servers, players will be able to earn rewards more quickly, then exchange them.
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### <center>Thank you so much for reading this post.</center>
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