• How would you go about solving the issues of
a)Organize along the commodity lines, geographically, or both
b)Full Autonomy/ Centralized Controlc)Group directors?d)Group Directors and Business Unit Heads
Need for modifications?Need for modifications?
• Lack of focus
• Appalling safety record
• Structure and Culture
• Portfolio of products?
Organization StructureOrganization Structure
DECENTRALIZED HISTORIC DIVISIONAL STRUCTURE
JOHANNESBURG
LONDON
Decentralized & Autonomy
Economies of scope
Synergy
Best practices
Organizational ControlsOrganizational Controls
Actual Results with expected result
Strategic Controls
- External Environment & Competitive advantage
Financial Controls
- Return on Assets and Return on Investment
Value Creating DiversificationValue Creating Diversification
Operational R
elatedness
Corporate Relatedness
Low high
LowH
igh
SBU M-FormSBU M-Form
NEW DIVISIONAL STRUCTURE
Chile Brazil South AfricaAustrali
a
Commodity lines with geographic divisions
Moderate Autonomy & Centralization
Economies of scope ( Procurement)
Shared best practices
Synergy between business unit
Reemploy Chief strategic officer