Smith, Christopher S. (1999) Divisional strategy : value creation and relatedness within the multidivisional firm. PhD thesis, University of Warwick.

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Abstract

From an economic perspective the value of a group of related businesses under one
management is derived from the potential for synergy, based on the exploitation of
underlying economies of scope. To realise this inherent economic value,
organisational theorists have argued that a purposively cooperative pattern of
structures, systems and processes must be put in place. Divisions of modem
multidivisional companies are internal, quasi-corporations of related businesses and,
as such, theoretical economic/organisational rationales would posit divisions as
cooperative enterprises.
Using a sample of divisions purposively chosen to comprise businesses that were
highly related, this thesis set out to explore the extent to which divisional managing
directors expressed views and initiated organisational dynamics consistent with a
cooperative perspective. Semi-structured interviews with senior divisional personnel
in 12 divisions and with business and functional level staff in 2 of these provided the
prime source of data which served as a basis from which a case study was written for
each division. The cases were analysed in terms of the membership benefits (value)
the divisional managing director was attempting to optimise for the component
businesses and the extent to which he expressed a cooperative orientation and was
overseeing cooperative structures, processes and systems.
Two categories of division are identified. The 'cooperative' grouping is consistent
with the theoretical view of economies of scope and cooperative structures but a
larger number of divisions are categorised as 'non-cooperative' with perspectives,
systems etc. consistent with a traditional M-form orientation of autonomous, non-interacting
businesses.
Reasons for this mismatch of theory and practice are discussed with the existence of
non-cooperative divisions being explained as the consequence of a variety of
organisational contingencies. Implications for divisional management and practice in
multidivisional firms are suggested.

Item Type:	Thesis or Dissertation (PhD)
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor
Library of Congress Subject Headings (LCSH):	Economies of scope, Business enterprises -- Great Britain -- Case studies, Strategic planning, Management -- Great Britain -- Case studies
Official Date:	July 1999
Dates:	Date Event July 1999 Submitted
Institution:	University of Warwick
Theses Department:	Warwick Business School
Thesis Type:	PhD
Publication Status:	Unpublished
Supervisor(s)/Advisor:	McGee, John, Ph. D. ; Whittington, Richard, 1958-
Extent:	x, [395] leaves
Language:	eng
URI:	http://wrap.warwick.ac.uk/id/eprint/4287

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