Hitt M.A., Ireland R.D., Hoskisson R.E. Strategic Management: Competitiveness and Globalization: Concepts

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Multidivisional

Structure

(M-form)

Strategic Business Unit

(SBU) Form

Cooperative

Form

Competitive

Form

Figure 11.4 Three Variations of the Multidivisional Structure

Government

Affairs

Legal

Affairs

President

Headquarters Ofﬁce

Corporate

Human

Resources

Corporate

Marketing

Corporate

Finance

Strategic

Planning

Corporate

R&D Lab

Product

Division

Product

Division

Product

Division

Product

Division

Product

Division

Figure 11.5 Cooperative Form of the Multidivisional Structure for Implementing a Related Constrained Strategy

Notes:

• Structural integration devices create tight links among all divisions

• Corporate office emphasizes centralized strategic planning, human resources, and marketing to foster cooperation between divisions

• R&D is likely to be centralized

• Rewards are subjective and tend to emphasize overall corporate performance in addition to divisional performance

• Culture emphasizes cooperative sharing

Hewlett-Packard (HP) has three main related

businesses through which it pursues industry

leadership and technology development.

First, it has the Personal Systems Group,

including business and consumer PCs,

mobile computing, and workstation devices.

Second, it has a complementary business with a very large market share in Imaging and

Printing, which includes inkjet and laserjet printers, commercial printing, printing supplies,

digital photography, and entertainment products and support. Finally, it has a Technology

Service Solutions Group, which includes business products focused on servers and storage,

managed services and software, and services solutions. This group has been augmented

through its recent acquisition of Electronic Data Systems (EDS). HP is number nine in the

2009 Fortune 500 Ranking with more than $118 billion in total revenue for fiscal year 2008.

Its main focus for customers is on corporate data centers that allow connected mobile

computing, printing, and imaging delivery. HP pursues a related constrained strategy (as

discussed in Chapter 6) by using the cooperative

M-form structure. As firms pursue diversified

growth and the economy becomes more Internet

based, corporate data centers are increasingly

important to help firms pursue improved top-line

and bottom-line growth. HP’s three main businesses

allow the related strategy to work well by focusing

on the growing importance of corporate data

centers. Firms that seek to deliver the products

and services necessary to the centers are required

to have interrelated services and businesses to sell

integrated solutions.

This is driving firms that have a dominant focus

on one product category to move into the other

categories. For instance, Cisco, as noted in the

Opening Case, is moving toward a corporate data

center approach but coming at it from a traditional

focus on network equipment. For this reason it is

now moving into servers, which has been one of HP’s

dominant businesses (Cisco previously partnered

with HP in this area). Like Cisco, HP has moved away

from its formerly decentralized structure toward a related constrained strategy by seeking to

implement the cooperative M-form organization structure. The cooperative M-form requires

more centralization to make it function appropriately and to foster cooperation between

the separate divisions within and across business unit divisions. This requires distinctive

leadership and focus on improved execution to function properly.

Mark Hurd, the current CEO who succeeded Carly Fiorina in 2005, has been able to fine-

tune HP’s structural approach through his “get things done” mentality. One security analyst

describes Hurd as someone who is, “… all about execution and has an uncanny ability to get

things done.” Furthermore, this same analyst suggests, “He is the most adept at taking costs

out of the system than any executive I know.” His no-nonsense style has led to increasing

operational efficiency by realizing a strong implementation of the cooperative M-form

structure. For instance, through the $13 billion acquisition of the consulting services firm

HEWLETT-PACKARD

IMPLEMENTS THE RELATED

CONSTRAINED STRATEGY

THROUGH THE COOPERATIVE

M-FORM STRUCTURE

Mark Hurd, President and CEO of

Hewlett-Packard, has increased

efficiency and reduced costs at HP

through the implementation of the

cooperative M-form structure.

David Paul Morris/Getty Images News/Getty Images

330

Part 3: Strategic Actions: Strategy Implementation

among its products (servers, storage, mobile computing, and high-speed printers) and

coordinating these products through value-added services. This has required the

implementation of the cooperative M-form and more centralization among the vari-

ous business units to foster cooperation and synergy.

Sharing divisional competencies facilitates the corporation’s efforts to develop econ-

omies of scope. As explained in Chapter 6, economies of scope (cost savings resulting

from the sharing of competencies developed in one division with another division) are

linked with successful use of the related constrained strategy. Interdivisional sharing of

competencies depends on cooperation, suggesting the use of the cooperative form of the

multidivisional structure.

HP seems to have developed the structure and processes well

to accomplish this.

The cooperative structure uses different characteristics of structure (centralization,

standardization, and formalization) as integrating mechanisms to facilitate interdivisional

cooperation. Frequent, direct contact between division managers, another integrating

mechanism, encourages and supports cooperation and the sharing of competencies

or resources that could be used to create new advantages. Sometimes, liaison roles are

established in each division to reduce the time division managers spend integrating and

coordinating their unit’s work with the work occurring in other divisions. Temporary

teams or task forces may be formed around projects whose success depends on sharing

competencies that are embedded within several divisions. Cisco has used these devices to

develop new cooperative strategies, as illustrated in the Opening Case. Formal integration

departments might be established in firms frequently using temporary teams or task

forces.

Ultimately, a matrix organization may evolve in firms implementing the related con-

strained strategy. A matrix organization is an organizational structure in which there

is a dual structure combining both functional specialization and business product or

project specialization.

Although complicated, an effective matrix structure can lead to

improved coordination among a firm’s divisions.

The success of the cooperative multidivisional structure is significantly affected by

how well divisions process information. However, because cooperation among divi-

sions implies a loss of managerial autonomy, division managers may not readily commit

EDS in 2008, Hurd cut 15,000 jobs or 10 percent of the workforce to create the synergistic

effect needed across all businesses. In 2009, this led HP to project a decline of 5 percent

in revenues, but to still be able to project a 6 percent growth in profits, all despite the

economic downturn.

Although the cooperative structure implementation has created wealth and efficiency,

there are those who speculate that Hurd’s approach has an Achilles heel because it lacks an

emphasis on breakthrough innovation such as Apple’s iPod and iPhone. Robert Burgelman,

a Stanford professor who has studied Hurd, says, “He will not tell them we should do this

project or that project. He helps them think more clearly about the space in which they are

operating.” While these actions have made HP’s R&D operations more efficient, Hurd may

need to give employees more creative license if he wants breakthrough innovations that

would allow HP to compete more effectively with IBM and Apple.

Sources: J. Brodkin, 2009, HP BladeSystem, Matrix takes aim at Cisco, Network World, April 20, 34; A. Lashinsky, 2009,

Mark Hurd’s moment, Fortune, March 16, 90–100; J. Scheck, 2009, Corporate news: HP chief sees more pain ahead,

trims more jobs, Wall Street Journal, May 20, B3; B. Worthen & J. Scheck, 2009, H-P to step up fight in market for

servers, Wall Street Journal, April 16, B5; C. Edwards, 2008, How HP got the wow! back, BusinessWeek, December 20,

60; J. Fortt, 2008, Mark Hurd, superstar, Fortune, June 29, 35; J. Jain, 2008, Decision sciences: A story of excellence

at Hewlett-Packard, OR-MS Today, 35(2): 20; L. Lee, 2008, HP’s Hurd is about to be tested: After a sterling three-year

run, the company’s CEO faces a weaker PC market and a stronger Dell, BusinessWeek, February 14, 59–60; 2008,

Business: Now services; Hewlett-Packard, Economist, May, 78; D. M. Zell, A. M. Glassman, & S. A. Duron, 2007, Strategic

management in turbulent times: The short and glorious history of accelerated decision making at Hewlett-Packard,

Organizational Dynamics, 36(1): 93–104.

331

themselves to the type of integrative information-processing activities that this structure

demands. Moreover, coordination among divisions sometimes results in an unequal flow

of positive outcomes to divisional managers. In other words, when managerial rewards

are based at least in part on the performance of individual divisions, the manager of the

division that is able to benefit the most by the sharing of corporate competencies might

be viewed as receiving relative gains at others’ expense. Strategic controls are important in

these instances, as divisional managers’ performance can be evaluated at least partly on the

basis of how well they have facilitated interdivisional cooperative efforts. In addition, using

reward systems that emphasize overall company performance, besides outcomes achieved

by individual divisions, helps overcome problems associated with the cooperative form.

Using the Strategic Business Unit Form of the Multidivisional Structure to

Implement the Related Linked Strategy

Firms with fewer links or less constrained links among their divisions use the related

linked diversification strategy. The strategic business unit form of the multidivisional

structure supports implementation of this strategy. The strategic business unit (SBU)

form

is an M-form structure consisting of three levels: corporate headquarters, strategic

business units (SBUs), and SBU divisions (see Figure 11.6). The SBU structure is used

by large firms and can be complex, given associated organization size and product and

market diversity.

President

Headquarters Ofﬁce

Strategic

Planning

Corporate

Marketing

Corporate

Human

Resources

Corporate

Finance

Corporate

R&D

Strategic

Business

Unit

Strategic

Business

Unit

Strategic

Business

Unit

Division Division

Division

Division DivisionDivision Division DivisionDivision

Figure 11.6 SBU Form of the Multidivisional Structure for Implementing a Related Linked Strategy

Notes:

• Structural integration among divisions within SBUs, but independence across SBUs

• Strategic planning may be the most prominent function in headquarters for managing the strategic planning approval process of SBUs for the president

• Each SBU may have its own budget for staff to foster integration

• Corporate headquarters staff members serve as consultants to SBUs and divisions, rather than having direct input to product strategy, as in the cooperative form

The strategic business

unit (SBU) form is an

M-form consisting of

three levels: corporate

headquarters, strategic

business units (SBUs),

and SBU divisions.

Chapter 11: Organizational Structure and Controls

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Part 3: Strategic Actions: Strategy Implementation

The divisions within each SBU are related in terms of shared products or markets or

both, but the divisions of one SBU have little in common with the divisions of the other

SBUs. Divisions within each SBU share product or market competencies to develop

economies of scope and possibly economies of scale. The integrating mechanisms used

by the divisions in this structure can be equally well used by the divisions within the

individual strategic business units that are part of the SBU form of the multidivisional

structure. In this structure, each SBU is a profit center that is controlled and evaluated by

the headquarters office. Although both financial and strategic controls are important, on

a relative basis financial controls are vital to headquarters’ evaluation of each SBU; stra-

tegic controls are critical when the heads of SBUs evaluate their divisions’ performances.

Strategic controls are also critical to the headquarters’ efforts to determine whether the

company has formed an effective portfolio of businesses and whether those businesses

are being successfully managed.

Sears Holdings changed to the SBU form in 2008 by dividing into five strategic

business units (with multiple divisions as parts of each SBU): brands, real estate, support,

online, and store operations.

This allowed for related businesses to work together (such

as Sears and K-Mart) to focus on their distinct customer sets, but also provided for better

control for headquarters in order to evaluate performance of each strategic business unit

and division within the SBU.

Sharing competencies among units within an SBU is an important characteristic of

the SBU form of the multidivisional structure (see the notes to Figure 11.6). A drawback

to the SBU structure is that multifaceted businesses often have difficulties in commu-

nicating this complex business model to stockholders.

Furthermore, if coordination

between SBUs is needed, problems can arise because the SBU structure, similar to the

competitive form discussed next, does not readily foster cooperation across SBUs.

Using the Competitive Form of the Multidivisional Structure to Implement

the Unrelated Diversification Strategy

Firms using the unrelated diversification strategy want to create value through efficient

internal capital allocations or by restructuring, buying, and selling businesses.

The com-

petitive form of the multidivisional structure supports implementation of this strategy.

The competitive form is an M-form structure characterized by complete indepen-

dence among the firm’s divisions which compete for corporate resources (see Figure 11.7).

Unlike the divisions included in the cooperative structure, divisions that are part of the

competitive structure do not share common corporate strengths. Because strengths are

not shared, integrating devices are not developed for use by the divisions included in the

competitive structure.

The efficient internal capital market that is the foundation for using the unrelated

diversification strategy requires organizational arrangements emphasizing divisional

competition rather than cooperation.

Three benefits are expected from the

internal competition. First, internal competition creates flexibility (e.g., corporate

headquarters can have divisions working on different technologies and projects

to identify those with the greatest potential). Resources can then be allocated to

the division appearing to have the most potential to fuel the entire firm’s success.

Second, internal competition challenges the status quo and inertia, because division

heads know that future resource allocations are a product of excellent current

performance as well as superior positioning in terms of future performance. Last,

internal competition motivates effort in that the challenge of competing against

internal peers can be as great as the challenge of competing against external rivals.

In this structure, organizational controls (primarily financial controls) are used to

emphasize and support internal competition among separate divisions and as the

basis for allocating corporate capital based on divisions’ performances.

Textron Inc., a large “multi-industry” company seeks “to identify, research, select,

acquire and integrate companies, and has developed a set of rigorous criteria to guide

The competitive form is

an M-form structure

characterized by complete

independence among

the ﬁ rm’s divisions which

compete for corporate

resources.

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Chapter 11: Organizational Structure and Controls

decision making.” Textron continuously looks

“to enhance and reshape its portfolio by divesting

non-core assets and acquiring branded businesses

in attractive industries with substantial long-term

growth potential.” Textron operates four indepen-

dent businesses—Bell Helicopter (20 percent of

revenue), Cessna Aircraft (40 percent), Textron

Systems (15 percent), Finance (5 percent), and

Industrial (20 percent). The firm uses return on

invested capital (ROIC) as a way to evaluate the

contribution of its diversified set of businesses as

they compete internally for resources.

To emphasize competitiveness among divi-

sions, the headquarters office maintains an

arm’s-length relationship with them, intervening

in divisional affairs only to audit operations and discipline managers whose divisions

perform poorly. In emphasizing competition between divisions, the headquarters

office relies on strategic controls to set rate-of-return targets and financial controls

to monitor divisional performance relative to those targets. The headquarters office

then allocates cash flow on a competitive basis, rather than automatically returning

cash to the division that produced it. Thus, the focus of the headquarters’ work is on

performance appraisal, resource allocation, and long-range planning to verify that

the firm’s portfolio of businesses will lead to financial success.

President

Headquarters Ofﬁce

Finance Auditing

Legal Affairs

Division Division Division DivisionDivision Division

Figure 11.7 Competitive Form of the Multidivisional Structure for Implementing an Unrelated Strategy

Notes:

• Corporate headquarters has a small staff

• Finance and auditing are the most prominent functions in the headquarters office to manage cash flow and assure the accuracy of performance data coming

from divisions

• The legal affairs function becomes important when the firm acquires or divests assets

• Divisions are independent and separate for financial evaluation purposes

• Divisions retain strategic control, but cash is managed by the corporate office

• Divisions compete for corporate resources

Made of up four

independent businesses,

including Cessna

Aircraft, Textron relies

on an analysis of return

on invested capital to

determine the allocation

of internal resources.

Transtock/Terra/CORBIS

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Part 3: Strategic Actions: Strategy Implementation

The three major forms of the multidivisional structure should each be paired with

a particular corporate-level strategy. Table 11.1 shows these structures’ characteristics.

Differences exist in the degree of centralization, the focus of the performance appraisal,

the horizontal structures (integrating mechanisms), and the incentive compensation

schemes. The most centralized and most costly structural form is the cooperative structure.

The least centralized, with the lowest bureaucratic costs, is the competitive structure.

The SBU structure requires partial centralization and involves some of the mechanisms

necessary to implement the relatedness between divisions. Also, the divisional incentive

compensation awards are allocated according to both SBUs and corporate performance.

Matches between International Strategies and

Worldwide Structure

As explained in Chapter 8, international strategies are becoming increasingly important

for long-term competitive success

in what continues to become an increasingly border-

less global economy.

Among other benefits, international strategies allow the firm to

search for new markets, resources, core competencies, and technologies as part of its

efforts to outperform competitors.

As with business-level and corporate-level strategies, unique organizational struc-

tures are necessary to successfully implement the different international strategies.

Forming proper matches between international strategies and organizational structures

facilitates the firm’s efforts to effectively coordinate and control its global operations.

More importantly, research findings confirm the validity of the international strategy/

structure matches we discuss here.

Using the Worldwide Geographic Area Structure to Implement the

Multidomestic Strategy

The multidomestic strategy decentralizes the firm’s strategic and operating decisions to

business units in each country so that product characteristics can be tailored to local pref-

erences. Firms using this strategy try to isolate themselves from global competitive forces

by establishing protected market positions or by competing in industry segments that

are most affected by differences among local countries. The worldwide geographic area

structure is used to implement this strategy. The worldwide geographic area structure

emphasizes national interests and facilitates the firm’s efforts to satisfy local differences

(see Figure 11.8).

Overall Structural Form

Structural Characteristics Cooperative M-Form

(Related Constrained

Strategy)

SBU M-Form (Related Linked

Strategy)

Competitive M-Form

(Unrelated Diversiﬁ cation

Strategy)

Centralization of

operations

Centralized at corporate

ofﬁ ce

Partially centralized (in SBUs) Decentralized to divisions

Use of integration

mechanisms

Extensive Moderate Nonexistent

Divisional performance

appraisals

Emphasize subjective

(strategic) criteria

Use a mixture of subjective

(strategic) and objective (ﬁ nancial)

criteria

Emphasize objective

(ﬁ nancial) criteria

Divisional incentive

compensation

Linked to overall corporate

performance

Mixed linkage to corporate, SBU,

and divisional performance

Linked to divisional

performance

Strategy implemented with structural form.

Table 11.1 Characteristics of the Structures Necessary to Implement the Related Constrained, Related Linked, and Unrelated

Diversiﬁ cation Strategies

The worldwide

geographic area

structure emphasizes

national interests and

facilitates the ﬁ rm’s efforts

to satisfy local differences.

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Chapter 11: Organizational Structure and Controls

Although the automobile industry is doing poorly in global markets, on a relative

basis Ford of Europe is doing better than other auto firms in Europe within the same

middle market segment strategy. This is due to the fact that Ford implemented the world-

wide geographic area structure more than a decade ago to give local European managers

more autonomy to manage their operations. One analysis called Ford “the most effi-

cient volume carmaker in Europe.”

Furthermore, they have an efficient set of designs

matched responsively to the European market. They have kept costs down by partnering

with European automakers such as Fiat and France’s PSA Peugeot Citroen on chassis and

engines. The timing of the release of their new models was also good to take advantage of

the European “cash for clunkers” program, although the underlying market is still weak.

Using the multidomestic strategy requires little coordination between different coun-

try markets, meaning that integrating mechanisms among divisions around the world are

not needed. Coordination among units in a firm’s worldwide geographic area structure

is often informal.

The multidomestic strategy/worldwide geographic area structure match evolved as

a natural outgrowth of the multicultural European marketplace. Friends and family

members of the main business who were sent as expatriates into foreign countries to

develop the independent country subsidiary often used this structure for the main

business. The relationship to corporate headquarters by divisions took place through

informal communication among “family members.”

A key disadvantage of the multidomestic strategy/worldwide geographic area

structure match is the inability to create strong global efficiency. With an increasing

emphasis on lower-cost products in international markets, the need to pursue worldwide

economies of scale has also increased. These changes foster use of the global strategy and

its structural match, the worldwide product divisional structure.

Multinational

Headquarters

Europe

Latin

America

Asia

United

States

Australia

Middle

East/

Africa

Figure 11.8 Worldwide Geographic Area Structure for Implementing a Multidomestic Strategy

Notes:

• The perimeter circles indicate decentralization of operations

• Emphasis is on differentiation by local demand to fit an area or country culture

• Corporate headquarters coordinates financial resources among independent subsidiaries

• The organization is like a decentralized federation

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Part 3: Strategic Actions: Strategy Implementation

Using the Worldwide Product Divisional Structure to Implement the Global

Strategy

With the corporation’s home office dictating competitive strategy, the global strategy is

one through which the firm offers standardized products across country markets. The

firm’s success depends on its ability to develop economies of scope and economies of

scale on a global level. Decisions to outsource or maintain integrated subsidiaries may

in part depend on the country risk and institutional environment in which the firm is

entering.

The worldwide product divisional structure supports use of the global strategy. In

the

worldwide product divisional structure, decision-making authority is centralized

in the worldwide division headquarters to coordinate and integrate decisions and actions

among divisional business units (see Figure 11.9). This structure is often used in rap-

idly growing firms seeking to manage their diversified product lines effectively. Avon

Products, Inc. is an example of a firm using the worldwide product divisional structure.

Avon is a global brand leader in products for women such as lipsticks, fragrances,

and anti-aging skin care. Committed to “empowering women all over the world since

1886,” Avon relies on product innovation to be a first-mover in its markets. For years,

Avon used the multidomestic strategy. However, the firm’s growth came to a screeching

halt in 2006. Contributing to this decline were simultaneous stumbles in sales revenues

in emerging markets (e.g., Russia and Central Europe), the United States, and Mexico.

To cope with its problems, the firm changed to a global strategy and to the worldwide

product divisional structure to support its use. Commenting on this change, CEO

Andrea Jung noted that, “Previously, Avon managers from Poland to Mexico ran their

own plants, developed new products, and created their own ads, often relying as much

Global

Corporate

Headquarters

Worldwide

Products

Division

Worldwide

Products

Division

Worldwide

Products

Division

Worldwide

Products

Division

Worldwide

Products

Division

Worldwide

Products

Division

Figure 11.9 Worldwide Product Divisional Structure for Implementing a Global Strategy

Notes:

• The headquarters’circle indicates centralization to coordinate information flow among worldwide products

• Corporate headquarters uses many intercoordination devices to facilitate global economies of scale and scope

• Corporate headquarters also allocates financial resources in a cooperative way

• The organization is like a centralized federation

In the worldwide

product divisional

structure, decision-

making authority is

centralized in the

worldwide division

headquarters to

coordinate and integrate

decisions and actions

among divisional business

units.

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Chapter 11: Organizational Structure and Controls

on gut as numbers.”

100

Today, Avon is organized around product divisions including

Avon Color, the firm’s “flagship global color cosmetics brand, which offers a variety of

color cosmetics products, including foundations, powders, lip, eye, and nail products,”

Skincare, Bath & Body, Hair Care, Wellness, and Fragrance. The analysis of these product

divisions’ performances is conducted by individuals in the firm’s New York headquarters.

One of the purposes of changing strategy and structure is for Avon to control its costs

and gain additional scale economies as paths to performance improvements. Avon has

announced the success of this restructuring program and vowed to cut costs even further;

the original program is “expected to result in annual savings of about $430 million by

2011–12,” while the new changes will result in “another $450 million expected to be

saved beginning in 2010.”

101

Integrating mechanisms are important in the effective use of the worldwide product

divisional structure. Direct contact between managers, liaison roles between departments,

and temporary task forces as well as permanent teams are examples of these mechanisms.

One researcher describes the use of these mechanisms in the worldwide structure: “There

is extensive and formal use of task forces and operating committees to supplement com-

munication and coordination of worldwide operations.”

102

The disadvantages of the

global strategy/worldwide structure combination are the difficulty involved with coordi-

nating decisions and actions across country borders and the inability to quickly respond

to local needs and preferences.

To deal with these types of disadvantages, Avon has a vast set of local salespeople who

are committed to the organization and who help the company to become locally respon-

sive. Another solution is to develop a regional approach in addition to the product focus,

which might be similar to the combination structure discussed next.

103

Using the Combination Structure to Implement the Transnational Strategy

The transnational strategy calls for the firm to combine the multidomestic strategy’s local

responsiveness with the global strategy’s efficiency. Firms using this strategy are trying to

gain the advantages of both local responsiveness and global efficiency. The combination

structure is used to implement the transnational strategy. The combination structure is

a structure drawing characteristics and mechanisms from both the worldwide geographic

area structure and the worldwide product divisional structure. The transnational strat-

egy is often implemented through two possible combination structures: a global matrix

structure and a hybrid global design.

104

The global matrix design brings together both local market and product expertise

into teams that develop and respond to the global marketplace. The global matrix design

(the basic matrix structure was defined earlier) promotes flexibility in designing prod-

ucts and responding to customer needs. However, it has severe limitations in that it

places employees in a position of being accountable to more than one manager. At any

given time, an employee may be a member of several functional or product group teams.

Relationships that evolve from multiple memberships can make it difficult for employees

to be simultaneously loyal to all of them. Although the matrix places authority in the

hands of managers who are most able to use it, it creates problems in regard to corpo-

rate reporting relationships that are so complex and vague that it is difficult and time-

consuming to receive approval for major decisions.

We illustrate the hybrid structure in Figure 11.10. In this design, some divisions

are oriented toward products while others are oriented toward market areas. Thus,

in some cases when the geographic area is more important, the division managers

are area-oriented. In other divisions where worldwide product coordination and

efficiencies are more important, the division manager is more product-oriented.

The Strategic Focus on PepsiCo illustrates the hybrid design. Although PepsiCo is

generally focused on geographic areas like most consumer product companies, as it

has diversified into snacks and other foods, it also has product divisions to build better

worldwide efficiencies.

The combination

structure is a structure

drawing characteristics

and mechanisms from

both the worldwide

geographic area

structure and the

worldwide product

divisional structure.