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ACCA Strategic Professional · Strategic Business Leader · Enabling success: organising

Corvane Group has three autonomous divisions, each with its own finance, HR and IT teams. The board finds that the same systems are bought three times, best practice is not shared, and divisional managers pursue division profit at the expense of group synergies. Which response best addresses these problems while keeping divisional accountability?

The best response is to centralise common support activities as shared services and add group-level coordination and performance measures. This cuts duplicated cost and promotes synergy while divisions keep profit accountability, unlike merging into a functional structure or separating the divisions entirely.

  1. ACentralise common support services as shared services and set group-level coordination and performance measuresCorrect
  2. BMerge the divisions into one functional structure and remove divisional profit responsibility
  3. CConvert each division into a separate legal firm with no group involvement
  4. DIntroduce a matrix with every employee reporting to two divisional heads

Explanation

The problems are duplication and sub-optimisation typical of divisional structures. Shared services remove duplicated support activity and group-level measures encourage synergy, while divisions remain accountable for profit. Full functional merger would lose market focus, and separation would worsen lost synergies.

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