Student information: Rutger Vis 1006834
Leroy Chin-A-Loi IBMS 1F
Teacher: Mr. Imeson
Unilever is one the World’s oldest multinational corporations with extensive product offerings in food, detergent, and personal care businesses.
Unilever was organized on decentralized bases, maintaining subsidiaries in each major national market. Only in Europe it maintained 17 subsidiaries accountable for its performance in the national market.
In the 1990’s this strategy lacked behind on its competitors in the rapidly changing competitive environment.
In 1996 it introduced a new structure based on regional business groups, each specifying on a specific category of products.
Lever Europe consolidated the production of product ins a few key locations to reduce costs and speed up product introduction. The 17 companies responded directly to Lever Europe and helped building the Pan-European strategy.
In 2000 it found itself still lagging behind, hence another reorganization set the aim to cut the number of brands that Unilever sold from 1600 to 400 that could be marketed on regional or global scale. To support this a new organization was established focusing on 2 global product divisions; a food division and a home personal care division. Within each division consist business groups focusing on business within a given region.
1. Why did Unilever’s decentralized organizational structure make sense from the 1950’s through the 1970’s? Why did this structure start to create problems for the company in the 1980’s?
Because then there was almost no competition in the markets Unilever was targeting, they mostly maintained the largest market share and there was probably not so much international influence from other multinationals.
It began to create problems for the company because influencing other multinationals started to offer global brand products, for cheaper...