Strategy and Structure: Chapters in the History of the American Industrial Enterprise

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"It is impossible in a bare outline to do anything like justice to the subtlety (if also, sometimes, the prolixity) of the argument and to the wealth of telling instances with which it is illustrated. The argument is not dogmatic or rigid and allows plenty of room for deviations, variants, and exceptions.... There is no doubt that this is a book of first-class importance...significant, not only for its substantive conclusions, original though these are, but as an example of the way in which fruitful relations can be established between economic and business history."
-- Journal of Economic History
This book shows how the seventy largest corporations in America have dealt with a single economic problem: the effective administration of an expanding business. The author summarizes the history of the expansion of the nation's largest industries during the past hundred years and then examines in depth the modern decentralized corporate structure as it was developed independently by four companies--du Pont, General Motors, Standard Oil (New Jersey), and Sears, Roebuck.

This 1990 reprint includes a new introduction by the author.

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Editorial Reviews

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"There is no doubt that this is a book of first-class an example of the way in which fruitful relations can be established between economic and business history." Journal of Economic History
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Product Details

  • ISBN-13: 9781587981982
  • Publisher: Beard Books, Incorporated
  • Publication date: 1/28/1962
  • Pages: 480
  • Product dimensions: 1.07 (w) x 5.00 (h) x 8.00 (d)

Table of Contents

Introduction--Strategy and Structure 1
Motives and Methods 1
Some General Propositions 7
1 Historical Setting 19
The Beginnings of Business Administration in the United States 20
The Coming of the Integrated, Multidepartmental Enterprise 24
Integration via Combination and Consolidation 29
Organization Building 36
Further Growth--The Coming of the Multidivisional Enterprise 42
2 Du Pont--Creating the Autonomous Divisions 52
The Centralized Structure 52
The Strategy of Consolidation 53
Creating the Multidepartmental Structure 57
Structural Modifications--1903-1919 62
Further Centralization--1919 67
The Strategy of Diversification 78
Initial Steps Toward Diversification 79
Intensified Pressures for Diversification 83
The Final Definition of the Strategy of Diversification 88
New Structure for the New Strategy 91
New Problems Created by New Strategy 92
The Problems Analyzed 94
A New Structure Proposed and Rejected 96
A Compromise Structure Adopted 100
Crisis and the Acceptance of the Multidivisional Structure 104
3 General Motors--Creating the General Office 114
The Durant Strategy 114
The Sources of Durant's Strategy 115
The Creation of General Motors 118
The Storrow Regime 120
Durant's Return and Renewed Expansion and Integration 122
Du Pont Contributions to Durant's Organization 125
The Crisis of 1920 128
The Sloan Structure 130
The Sources of Sloan's Structure 130
The "Organization Study" 133
Minor Modifications 140
Putting the New Structure into Operation 142
Defining Divisional Boundaries 142
The Development of Statistical and Financial Controls 145
Defining the Role of the Advisory Staff 153
The Role of the Executive Committee 157
The Finished Structure 158
A Comparison of Organization Building at General Motors and du Pont 161
4 Standard Oil Company (New Jersey)--Ad Hoc Reorganization 163
Structure and Strategy Before 1925 164
The Strategy of Vertical Integration and Continued Expansion 170
Vertical Integration and the Creation of New Functional Departments 172
Expansion and the Older Departments 175
The Growth of Staff Departments 177
The Board 181
Initial Awareness of Structural Weaknesses 182
The Initial Reorganization--1925-1926 185
Teagle's Troubles 186
The 1925 "Program" 188
The Coordination Department and Committee 189
The Budget Department and Committee 193
Reorganizing the Marketing Department 196
Reorganizing the Manufacturing Department 199
The Creation of the Multidivisional, "Decentralized" Structure 205
Continuing Difficulties 205
The 1927 Changes 208
Working Out the New Structure 216
Some Final Considerations 221
5 Sears, Roebuck and Company--Decentralization, Planned and Unplanned 225
Changing Strategy and Structure 225
Initial Strategy and Structure 226
The New Strategy 233
Structural Strains Created by the New Strategy 237
Abortive Decentralization 241
The Frazer Committee 242
The Committee's Proposals 243
Carrying Out the Committee's Proposals 249
Frazer Reviews the New Structure 252
Continuing Conflict and Resulting Proposals 253
The Territorial Organization Scrapped 260
Evolutionary Decentralization 261
The Centralized Retail Organization 261
Decentralization of the Retail Organization 265
The Growth of Local Regional Administrative Units 267
The Return to the Territorial Organization 268
The Final Structure 276
6 Organizational Innovation--A Comparative Analysis 283
The Adaptive Response 284
Building the Functional Departments 285
Building the Central Office 290
The Creative Innovation 299
The Conditions for Innovation 299
The Process of Innovation 303
The Significance of the Innovation 309
Organizational Innovators 314
An Organization Builder's Personality and Training 315
Sources of Information 320
7 The Spread of the Multidivisional Structure 324
Industries Not Accepting the New Structure 326
Copper and Nickel 327
Steel 331
Aluminum 337
Materials 340
Industries Partially Accepting the New Structure 342
Processors of Agricultural Products 344
Rubber 350
Petroleum 352
Industries Widely Accepting the New Structure 362
Electrical and Electronics 363
Power Machinery and Automobiles 370
Chemicals 374
Variations on Structural Change 378
The Merchandising Enterprises 378
Summary of the Process of Structural Change within the Enterprise 380
Conclusion--Chapters in the History of the Great Industrial Enterprise 380
The First Chapter--Accumulating Resources 386
The Second Chapter--Rationalizing the Use of Resources 387
The Third Chapter--Continued Growth 390
The Fourth Chapter--Rationalizing the Use of Expanding Resources 393
References 397
Notes 399
Index 455
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