One of Diocletian's first acts was to appoint an emperor for the western provinces; this emperor was a colleague of his, Maximian and he was appointed in 285. In 293, each appointed a junior colleague: Galerius in the east and Constantius in the west. Thus the tetrarchy formed: the system of government which divided power between four regional emperors, headed by Diocletian. New centres for government were established in Trier and Milan (by the troubled frontiers), in Thessalonica and Nicomedia.
Diocletian's reorganization overhauled the provinces by grouping them into 12 larger administrative units called dioceses. The separation of civil and military power was another drastic measure to reform the empire. Governors and dioceses had no military authority and army commands were organized in a way which cross-cut provincial boundaries, thus disabling the ability for one provincial governor to take command of any military actions.
Diocletian addressed the empire's economic problems by increasing the weight of gold coins, issuing the first good silver for a century and reorganizing the mints. A uniform coinage was introduced with each coin carrying the name of the mint at which it was produced. This was to trace any coins of bad quality back to the source. In 301 he attempted to curb inflation by freezing wages and prices of goods, but this did not hold for long. Diocletian's reforms were so successful that in 305 he was abdicated voluntarily.