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Executive Summary
When Asea and Brown Boveri merged, their primary objectives were to maintain and develop a technological edge in the power technologies business, exploit synergies that were created by the merger, and to develop a significant and thorough presence in worldwide markets. The merged company, ABB, became the largest manufacturer of engineering products globally, and establishes a global market share of 20%, and European market share of 33%. Upon completing the merger, the new organizations objective was to implement an effective global strategy. ABB needed to determine globalization strategy, which involved operating on a global basis. ...
ABB created an abundantly successful and distinctive management process and organization design that facilitated the amalgamation of various global operations, while sustaining a front-line atmosphere that was substantially entrepreneurial. ... In adopting a matrix structure for ABB, it created many conflicts. ...
Analysis
Asea and Brown Boveri Merger:
• Goals:
Maintain technological edge in power technologies
Exploit synergies created
Develop significant/thorough presence in worldwide markets:
Become largest manufacturer of engineering products globally
Establishes 20% globally market share, and 33% European market share
• Core competencies created:
Power/Automation technologies provider on a global basis
• Implement global strategy:
Organizational Structure
ABB developed exceedingly successful and distinctive management process and organization design that facilitated amalgamation of various global operations, whilst upholding front-line atmosphere that was substantially entrepreneurial
• Exemplifies sophistication of strategy-structure connection required as companies encourage requirement for entrepreneurial, cooperative, and receptive front-line entities, whilst endeavoring to grasp advantages of worldwide harmonization
Disadvantage created in hierarchy of ABB’s organization structure because policies and rules were implemented that defined behaviours, as opposed to guiding them
→ Organization design is source of discouragement to innovation
ABB also positively utilized networks in organization structure:
• steering committees and frequently changing councils used
• specialized programs implemented for sharing information in areas such as:
common research and development
consumer focus
total quality management
etc.
Approximate Word count = 1001
Approximate Pages = 4
(250 words per page double spaced)
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