Chandler substantiated his Structure follows Strategy thesis based on four case studies of American conglomerates that dominated their industry from the s What Is Chandler's Thesis with highest
Thesis[ edit ] Chandler substantiated his Structure follows Strategy thesis based on four case studies of American conglomerates that dominated their industry from the s onward. Chandler described how the chemical company Du Pontthe automobile manufacturer General Motorsthe energy company Standard Oil of New Jersey and the retailer Sears Roebuck managed a growth and diversification strategy by adopting the revolutionary multi-division form.
The M-Form is a corporate federation of semi-independent product or geographic groups plus a headquarters that oversees the corporate strategy and coordinates interdependencies. Although the organizational M-form was implemented differently by each of the organizations, Chandler showed that the need to restructure arose from a strategic shift driven by new technologies and market changes.
The M-form emerged and co-evolved with the development of the transportation and communication industries thereby creating the opportunity to manage across time and space.
He described corporate strategy as the determination of long-term goals and objectives, the adoption of courses of action and associated allocation of resources required to achieve goals; he defined structure as the design of the organization through which strategy is administered. Changes in an organization's strategy led to new administrative problems which, in turn, required a new or refashioned structure for the successful implementation of the new strategy.
Chandler's thesis argued that new organizational forms are no more than a derivative of strategy as he defined it. For example, they point out that a multidivisional structure biases a firm towards a conglomerate strategy.
Synthesis[ edit ] Henry Mintzberg offered a balanced view, arguing that the relationship between strategy and structure is reciprocal. Chapters in the History of the American Industrial Enterprise.Chandler's thesis argued that new organizational forms are no more than a derivative of strategy as he defined it.
Antithesis Hall and Saias inverted Chandler's thesis, suggesting that Strategy Follows Structure. D decisionsthatcontrolactionswithintheorganization Viewingthe managerinthiswayshowsusimmediatelywhyweareinterestedin decisionmakingandinformationflow.
A general examination covering this period has been made by D. F.
Channon, The Strategy and Structure of British Enterprise (Macmillan, ); see also Derek F. Channon, ‘Corporate Evolution in the Service Industries’, pp.
–34 below. Chandlers thesis By changing the strategy, an adaption in structure is needed Small firms want to expand their size or product range Vertical integration Increasing complexity increases the need for more coordiantion & communication Multidivisional structure Problems only studied the largest and most succesfull firms Technological movement at.
D decisionsthatcontrolactionswithintheorganization Viewingthe managerinthiswayshowsusimmediatelywhyweareinterestedin decisionmakingandinformationflow. Chandler’s assertion that strategy should determine organizational structure. Order your first today and attain special discount.
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