Analysis of the case.
This case is all about the problem faced by Hindustan lever regarding decentralization and reorganization. This case also focuses on the role that outside consultant plays in making management decision in decentralization\reorganization.
Hindustan lever is a large FMCG Company, with a huge range of products, in 1962 due to the increase in competition, the growing pressure from the government, changing market trends the company began to consider decentralization as a way of improving the organization's ability to respond to these things.
To find a solution they thought of reorganization by combining the three marketing Divisions i.e. soaps, toilet preparations and foods into one.
Due to the government control and market fluctuation they wanted to talk to only one person with regards to their three marketing divisions.
So a committee was formed to study the problem of reorganization and to recommend whether the three marketing divisions should be integrated or not.
The committee consisted of the marketing personnel from the same department. The committee recommended against integration.
Due to such recommendations the board members of HLL decided to refer the problem to the organization division of unilever.
So Mr. W G Beaton was appointed as a consultant to advice on the sort of technical marketing and services organizations HLL should be working towards over the next few years.
All the information regarding the organization structure, roles and responsibilities of each employee were provided to him. A short history of organizational development was provided, much more information was provided related to market; influence of govt, pricing policies and many more, which was asked by him.
When Mr. Beaton came to India he had a long discussion with the chairman of HLL and with the board members and then he met individually many members of the organization.