Delux Tool Case

Delux Holdings

After reading the Delux Tool Case and analyzing the information, the solution I would present as the management consultant would be to keep the companies in a divisional organization under a larger bureaucratic structure. Considering that it is an integration of three businesses, the proposed name of the business will be Delux Holdings, Inc. It will be headed by the owner and CEO himself, I.M. Tycoon.

In order to keep an eye on profits for each company there would need to be a separate functional department which covers the finance of the businesses. With such a structure in place I.M. Tycoon can set performance standards, then measure them, and take any corrective actions on any problems. This seems to be the best solution as each of the three companies are very different from each other and trying to overhaul the structures of all three companies could hurt the businesses. Each company is already successful on their own, but needs to have profits over the next three years before any sale off can be made.

The new structure will make use of departmentalization by product/project. This is also appropriate considering that that these three products belong to different industries. Each division will be headed a Vice President. Each division will have three departments – marketing, production/operations, and sales. These are important functional areas of each business. Each department will be headed by a Manager and will be composed of personnel who have the competence in their respective areas of business. The organizational structure can be a combination of divisional and project structures.

The finance, human resource, and legal departments will be supporting all the divisions and departments but do not have line of authority over them. The finance, legal, and human resource managers report directly to the CEO.