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Organisational Structure

Organisational Structure

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Published by Zas Arora

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Published by: Zas Arora on Jun 19, 2012
Copyright:Attribution Non-commercial

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05/13/2014

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P & G:Organisational structure
 
Organisational structure before 2005
THE MATRIX SYSTEM
 
 Advent of Matrix
 
 
Categorization of Business Units
 
Each unit with its Sales, Product Development,Manufacturing and Finance Functions
 
Dotted Line Reporting system was followed
*US president is just an example of country president
 
P & G:Organisational structure
 
THE GLOBAL MATRIX
 Arrival of Global Matrix Structure
 
 
Attractive expansion opportunities in Japan and developingmarkets led P&G question its globalization model.
 
 
They wanted to cover more diverse consumer taste and incomelevels.
 
 
Corporate functions still lacked direct control of countryfunctional activities.
 
Global Matrix Structure
 
 
P&G started migrating to a global matrix structureE
urope’s country functions were consolidated into continental
functions
 
Characterized by dotted line
 
Global functional SVP’s managed functions across all regions;
 
 
P & G:Organisational structure
 
 
P&G created global category presidencies reporting directly toCEO;
 
This structure allowed for the creation of global technical centersin different regions. Each with a core competency in a specificproduct category
Problems of The Global Matrix
 
 
It was never symmetrical
 
Management by functional conflicts led to poor strategicalignments throughout the companyfor e.g.
 – 
product supply made global efforts to reduce thenumber of chemical suppliers whereas, R&D looked for highperformance ingredients no matter where they came from. Due towhich it was difficult for regional managers to focus on particularcountries to address these global conflicts.
 
There was tension between product category & regionalmanagement though regional managers had responsibility forfinancial result.
 
R&D and global category leaders fought hard to globalize newtechnological and brand innovations quickly.
 
Due to the internal conflicts the competitors were catching upquickly.
 
The organizational structure was facing a big question mark whether it is going to sustain for long term or not.

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