Most researchers have contended that designing a firm's formal organization to suit strategic requirements is one of the keys to implementing the firm's corporate strategy. This article, however, demonstrates that at lower levels in the hierarchy—specifically, at the product level—there are real problems to making the linkage between strategy and formal organization. It identifies the major factors which appear to constrain and dissuade companies from varying their formal organizational arrangements at the product level. This article proposes that it is the more subtle, more informal management processes which may be the real key to implementing strategy at lower levels within large diversified corporations.
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