ABB CASE STUDY

ABB Case Study



ABB Case Study

Introduction

This paper intends to discuss the case of ABB. The case refers to the organization of activities by international firms in support of their strategies. The structure of companies must be built in accordance with the strategies of the company. ABB is assumingly the world's most complex forms, significantly diversified both by product and geography.  In addition, it has been often cited as the ultimate example of a 'transnational' firm.  The case of ABB will also helps to clarify the role of managers in conceiving strategies, designing structures and leading organizational transformation. This particular paper will answer three questions related to the case of ABB.

Discussion

Answer 1

Frustrating Cycle of Change at ABB

All the different organizational transformations conducted by different Chief Executive Officers represents the frustrating cycle of change at ABB. All the strategic initiatives adopted by different CEOs reflect basic differences at core. With the presence of so many CEOs, each one of them tried to implement restructuring of the company with their own style. Centralization of control systems, developing unique corporate identification, streamlining basic operations and most importantly the diversification through huge acquisitions were some of the main initiatives carried out by various CEOs (Zalan & Pucik, 2007 Pp. 1-20). Moreover, the effort to create innovative organization by facilitating the localization and global matrix structure also depicts the frustrating cycle of change at ABB. So many continuous and different changes made the employees of the company unable to recognize their core responsibilities and also contributed towards ineffective operations within the company. Employees were not aware of the actual strategic objective of the company and thus they were not able to focus on the achievement of that objective. Moreover, no long term strategy for the company was evident. After the retirement of Percy Barnevik, ABB was never able to gain leadership that can manage international operations effectively (Zalan & Pucik, 2007 Pp. 1-20).

Problems of ABB

The problems of ABB were derived all the three factors related to strategy, organization and external factors. The strategic factor is the absence of effective transnational strategy. The external factors that influenced the performance of the company include the attacks of 9-11, the Asian Financial Crisis and overall economic downturn. The organizational factors that influenced the company were mainly the inefficient conduct of services, immense restructuring efforts, the pension scandal and mounting short term debt. ABB faced difficulties in all the three areas making it difficult for them to become a business unit that can effectively implement transnational strategy (Zalan & Pucik, 2007 Pp. 1-20).

Answer 2

Recommendations to Kindle

Firstly, I would like to recommend Kindle to find effective solutions to become able to balance the international operations. Having almost 1300 subsidiary companies in different parts of the world possess different needs and requirements to cater. Kindle need to develop on an organizational model which can function effectively. I would recommend Kindle to implement the 'global business organizational model' because it provides the company an opportunity to make the process ...