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City of Santa Ana RFP 17-072 1 Statement of Qualifications (Revised 11/9/17) • r <br />Figure 2: Critical Success Factors <br />Central/zatlonlDecentralizatlon Cycle <br />Structures have benefits and challenges. For example, a decentralized structure can be perceived as <br />being more responsive to the needs of the various operational departments, with the business being able <br />to control decisions/budgets, and having the option to customize services to local requirements. These <br />benefits can be offset by disparate processes, multiple standards and redundancies as several <br />departments provide similar services. A decentralized structure can have difficulty managing and <br />reporting on compliance to policies and controls, costs are typically higher, and any increase in needs <br />requires a proportionate increase in administrative resources (not scalable). <br />In contrast, a centralized structure can benefit from common systems and support, a strong compliance <br />environment, and lower costs through economies of scale. However, a centralized model can be <br />perceived as remote from the business, bureaucratic, and operational departments may see the <br />centralized function as simply corporate overhead. Unresponsive and inflexible services from a central <br />group can spawn shadow operations where operational departments build their own systems and <br />procedures to provide services customized to local needs, <br />Some organizations move through centralization/decentralization cycles, as they struggle to optimize <br />their structure and operating model. For example, an organization may experience a control failure or a <br />directive from a central body that causes it to move from a decentralized model to centralized. After a <br />few years of extracting costs and standardizing, a new executive may emphasize service delivery sitting <br />closer to the business, providing the impetus for decentralization of operations. This cycle is illustrated <br />in Figure 3. <br />Chazey Partners Revised per email communication request 10/31/17 <br />20A-42 <br />