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Should You Centralize or Distribute Operations?

Here's a Third Alternative to Consider

Guest post by Daryl Berver, COO of Agora Inc.


Throughout my career heading operations for Agora, I’ve always struggled with the question of centralized versus decentralized applications, and never more-so than in the past year. Which is preferable? More efficient? Traditional knowledge says you centralize for efficiency and decentralize for innovation.

Makes sense.

Centralized applications are cheaper for the business if you have different operational units in the company. Most publishing companies are smaller groups within a larger business, and this type of application structure is rather common. Looking at things from a high level economic view, it’s easy to see why. Centralization reduces needless redundancies between applications, saving the company both human and monetary capital. Add in the fact that learning and knowledge sharing become easier in a centralized system, and it’s no wonder this structure is so widely used.

Of course, the con here is that a large, centralized structure can stifle innovation. When a group becomes too large, the red tape starts to appear. Then the business unit feels beholden to the existing structure, and it becomes difficult to breakout and really innovate.

But I believe there’s a third option: centralized applications via a shared service bureau.

This third choice is how we are structured at Agora, and I think it gives the best of both worlds if managed properly (whether or not we manage things perfectly is another story altogether). Since Publishing Services is a zero-profit service bureau, our main goal is to service the business needs of our clients, and do it at as little cost to them as possible. This means we benefit from the cost-saving aspects of a centralized structure, while still maintaining the autonomy to reorganize—thereby encouraging innovation and specialized service.

For instance; though Publishing Services remains a wholly owned entity of Agora, we recently split our support into two different companies. Publishing Services focuses on clients in the US while our new group, Agora Publishing Services Ireland, is being established to service Agora’s international affiliates. This should give us the flexibility to support and develop our applications to their fullest potential without significantly raising costs to our clients.

I think we can have the best of both worlds.

Daryl Berver is the COO of Agora, Inc., headquartered in the historic Mount Vernon area of Baltimore, Maryland.  The companies that make up the Agora network publish more than 300 books and 40 newsletters, reaching 1 million readers from around the world.  Agora and its affiliated companies have a footprint in 17 countries worldwide. Agora Publishing has been an Advantage client since 2000.

Filed under: News, Homepage-News, Dan's Blog

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