Single Industry Organizational Structure Industry Familiarity Of Corporate Management Functional Background of corporate Management $ecision Making %uthority

Size of Corporate staff eliance on Internal &romotion 'se of Internal (ransfers Corporate Culture Functional HIgh ele!ant Operating "#perience More Centralized High High High Strong

Related Diversification Business HIgh ele!ant Operating "#perience More Centralized High High High Strong

Unrelated Diversification Holding Company Low Mainly Finance

More $ecentralised Low Low Low )eak

$ifferent Corporate Strategies * Management Control Implication Single Industry Strategic &lanning Budgeting Control of Manager o!er Budget Formulation Importance %ttached to Budget Meeting (ransfer &ricing Sourcing Fle#i,ility Incenti!e Compensation Bonus determination %pproach Bonus Basis +ertical Cum horizontal Low Related Diversification Unrelated Diversification +ertical only High

Low High Constrained Financial and -on Financial Criteria &rimarily Su,.ecti!e Based on ,oth Business unit and corporate performance

High Low %rm Length &ricing &rimarily Financial criteria &rimarily formula ,ased &rimarily ,ased on Business 'niit performance