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17 - The division's organization, competence, and collaboration for new business creation

Published online by Cambridge University Press:  22 September 2009

Vijay Sathe
Affiliation:
Claremont Graduate School, California
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Summary

This chapter examines how the division's organization, competence, and collaboration influence new business creation (Table 17.1).

Frequent reorganizations hamper new business creation

Xerox OPD had already endured several reorganizations when Greg Gibbons became the fourth DGM in six years. He reorganized OPD once again by breaking up the functional organization, “the silos” as he referred to them, to create strategic business units (SBUs) overseen by an Office of the President, which was subsequently disbanded. Whatever their merits, these frequent reorganizations created confusion and disruption that hampered new business creation.

Monsanto Fab Products also underwent several organizational changes in the quest for the right organization for new business creation. When Dan Stewart became DGM of Fab Products, he broke up the functional organization to create self-sufficient business units (BUs). His successor, Ian McVay, reorganized Fab Products into a matrix.

At 3M Micrographics, there was some organizational disruption when the 35mm lines were peeled off to create the Engineering Products department, but this was the normal 3M practice of “cloning” divisions once they became too large. AMP Sigcom and 3M Micrographics did not hinder their new business creation efforts with frequent organizational surgery.

A moratorium on reorganizations is not being recommended, but there is a lot to be said for less frequent organizational changes.

Type
Chapter
Information
Corporate Entrepreneurship
Top Managers and New Business Creation
, pp. 254 - 269
Publisher: Cambridge University Press
Print publication year: 2003

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