Centralization vs Decentralization

When designing companies, orgs or teams there is a fundamental binary leaders must decide on. Will they build teams with centralized structures or decentralized?

This decision can exist at a company wide level but trickles all the way down to teams. It is quite common to see decentralized teams but centralized reporting. For example, a feature or product team works independent of other feature/product teams but individual reporting is into a central discipline (Eng reports to Eng, Design reports to Design). This is often referred to as a functional org structure.

A divisional structure is where teams are organized around a goal and multiple functions work within that division towards that goal often reporting to some leader that runs that division like its own company inside the company.

For most of you reading this, you are faced with team or org design.