The Move Toward a Multidivisional Structure in European Organizations

Abstract

The research on which this draft is based was made possible by the combined financial support of the Center for Education in International Management (CEI), the Ford Foundation and the Harvard Graduate School of Business Administration for studies of the development of multinational companies. This article reports some of the findings of a survey study of recent changes in the structure of large European manufacturing organizations. The structural history of these companies in their headquarters' countries is examined and contrasted with that of large United States organizations. Although divisionalization has occurred, there are differences between the United States multidivisional model and the structures adopted in recent European reorganizations. Organizational change in European companies has typically occurred as a result of specific changes in the competitive environment rather than as result of changes in product diversification strategies. Structural change has been concentrated in particular industrial sectors.