Senior management of Nestlé, a large multinational corporation, is planning to restructure the organization due to the pandemic. Currently, Nestlé is decentralized around geographic areas. Therefore, the executive responsible for each area has considerable autonomy over manufacturing and sales. The new structure will transfer power to the executives responsible for different product groups; the executives responsible for each geographic area will no longer be responsible for manufacturing in their area but will retain control over sales activities.
1. According to the information provided, what is Nestlé’s new organizational structure? (2m)
2. Based on question 1, describe TWO (2) advantages and TWO (2) disadvantages of the implementation of the new structure to Nestle. (8m)
3. Referring to question 1, discuss in detail TWO (2) types of resistance senior management might encounter from this organizational change. (8m)
1. According to provided information, Nestles will use organizational product structure instead of geographical structure.
2. Best on question 1, the advantages of changing organization structures will include low production costs and production specialization. In contrast, disadvantages will include lowering the importance of geographical structures and reduces the need for anatomy.
3.Referring to question 1, senior management might face resistance from restructuring organization based on the poor level of communication with new manufactured good