Organizational Structure

U-form unitary form - split functional responsibilities Mfg. Marketing , Personnel, Finance etc When firms got too larger especially when the diversified firm made it ineffective. In response Duport, GM etc developed the Multi-divisional M-form that allowed semi-autonomous divisions each with its own set of functions based on Brand, Produduct or Regional Lines. Successful because Execs could focus on Corporate Strategy

Advanatges of M-form 1. Addtion / deletion is easier 2. Accountability, 3. Comparision Chandler says these can lead to Scales / Scope advantages but also higher admin costs.

Organizational structures Functional - Centralized around key functions Functional Holding - core centralized around key function - rest is decentralized Holding - Highly decentralized Multi-divisional, centraized strategically, decentralized ops

Criticisms 1. No academic link between relatededness and performance more to do overcoming issues with Industry structure and firm specific characteristics 2. Prahalad and Hamel decry the tyranny of the SBU as it does not facilitate complex interactions