Proctor & Gamble: Organization 2005

490 Words2 Pages
Discussion9 Read the chapter8 case “Procter & Gamble: Organization 2005” (p. 323-339). The case focuses on Procter & Gamble’s growth over the years, and how the organization has been structured, and restructured to accommodate its globalization strategy. Discussion questions 1. Why did the US organizational structure shift from product grouping in the 1950s to a matrix in the 1980s? 2. 3. Why did the European organizational structure shift from geographic grouping in the 1950s to category management in the 1980s? 4. 5. Why were the two structures integrated into a global cube in the 1990s? 6. 7. What are the key distinguishing features of Organization 2005? Why did P&G adopt this structure? Improvements in communication and technology developments in transportation made mass production and distribution possible. In 1948, P&G established their first international sales department. The Division managed the quickly growing foreign business. Demand grew and local tariffs went away, as well as increases in shipping costs and more "flows" between countries, P&G built plants in other countries to provide from nearby sources. P&G established a presence in the foreign countries while maintaining operations in the US. There was a transition from the traditional line staff organization when the first product category division was established in 1943. In 1954, with growing lines of products, P&G created individual operating divisions in order to manage adequately. The European structure was developed with three dimensions: country, function and brand. P&G saw the need to respond to the local tastes and norms of the countries they were in. From the 1950s to the 1980s, Europe went through many changes, economic growth, growth in the communities and the fall of the Berlin Wall. The market in Europe went from a heterogeneous one to a more homogeneous and
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