Question: For over 1 2 5 years, Johnson & Johnson has stood as a beacon of a decentralized organizational structure, a testament to its adaptability and
For over years, Johnson & Johnson has stood as a beacon of a decentralized organizational structure, a testament to its adaptability and longevity. This structure, instrumental in propelling them to the ranks of the worlds largest corporations, has not been without its challenges, some of which have impacted their customers. Yet, the company's ability to harness the advantages of this structure, mitigating its disadvantages and making it work in its favor, is a source of inspiration for all.
Within the overarching framework of a decentralized organizational structure, Johnson & Johnson employs a more specific model known as a multidivisional or MForm structure. This vertical structure can be divided into productbased, marketbased, and geographical divisional structures. However, Johnson & Johnson represents a distinctive blend of all three. This structure empowers department heads with control over their resources and facilitates the division of employees into more manageable groups. Zacharias
While Johnson & Johnson has successfully made this organizational structure work, it has not been entirely troublefree. According to an MI.T case study, at one time, J&J was plagued by one of the most common problems associated with this type of structure. Each division was being run as its own company, with little to no communication between themselves. This led to no information or data being passed between the divisions. Employees felt they were employed by their division, not the parent company, so loyalty was minimal. Customers could even be called upon by up to Johnson & Johnson representatives, leading to frustration at the inefficiency this caused. These challenges highlight the complexities of managing a large organization like Johnson & Johnson, fostering empathy in students. Ross
This type of structure seems to work best for Johnson & Johnson. It involves departmentalization and dividing the organization into smaller, more manageable sections. An Executive Vice President leads each department and divides it into smaller subgroups, making it a more easily managed unit. Each unit can utilize this creatively and freely within its perspective groups. Departments can be divided according to their specialty or geographical location. For example, Johnson & Johnson has medical technology and pharmaceutical divisions. There are further departmental divisions for global or United States operations. By letting local management run their companies, J&J has turned this approach to its advantage. Galuska
Johnson & Johnson uses its decentralized structure as an asset, not a handicap. Decentralized structures have caught on in the tech world, allowing flexibility and creativity. These new companies can work in a fastpaced environment and remain extremely flexible and able to change when needed. This will enable teams to make decisions without wasting precious time by waiting for approval from the top. Kenton
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