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CMA Intermediate · Operations Management and Strategic Management · Formulation and Implementation of Strategy

A company's new strategy is to shift from selling standard products to customised solutions. Which action best reflects the leadership role of aligning structure with this strategy, following the idea that structure follows strategy?

Reorganising into customer-focused teams with authority to tailor offerings is best. Under the principle that structure follows strategy, the structure must change to support the new customisation strategy. Keeping the old structure or adding management layers would slow responsiveness and work against the strategy.

  1. ARetain the existing structure to avoid disruption
  2. BReorganise into customer-focused teams with authority to tailor offeringsCorrect
  3. CIncrease the number of management layers for tighter control
  4. DReduce employee training to cut costs

Explanation

The 'structure follows strategy' idea says structure should be redesigned to support the chosen strategy. Customisation needs customer-focused teams with decision authority. Keeping the old structure ignores the shift, and adding layers slows responses, which hurts customisation.

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