ING -- An Organizational Dilemma

Introduction

In 1854, 39 year old Daniel McCallum became the general superintendent of Erie Railroad, at that time one of the world’s largest railroad companies. Within months after taking over, McCallum noticed inefficiencies within the operating costs of the business (Makamson, 2000). As such, McCallum designed and laid out the first principles of organizational structure. The purpose of his organizational design was to enable a large business to operate as efficiently as a small one. As (Makamson, 2000) stated, “His organization chart, which became widely adopted, laid out the fundamental structural difference between the ubiquitous "functional" organization and the emerging corporate or multi-divisional structure.”

Much like Daniel McCallum and nearly 150 years later in 2003, the new CEO of ING’s Asia Pacific for Insurance, Jacques Kemp was reviewing the regional operating structure, performance, and growth strategy and noticed some management inefficiencies (Schotter, 2006). Kemp understood the huge economic growth opportunities within ING’s regional Asian markets and the need to plan for the future competition his company would face. As such, he noted their regional organization’s strategy was not aligned with the organization’s structure and the importance that functional management follow the same roadmap for strategy and execution (RSM, 2009).

Kemp understood if a specific well planned organizational structure is in place, an organization can operate more effectively and efficiently, thereby attaining greater profits. There is a step-by-step methodology which is considered when designing a company’s organizational structure to ensure a competitive advantage (Robbins & Coulter,...

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...nd corporate mission which all employees can follow. Only then will the workforce comprehend lines of authority and effectively communicate within the organization.

References

Makamson, E. (2000). The rise of the professional manager in America. Retrieved from

http://www.mgmtguru.com/mgt301/301_Lecture1Page7.htm

Rotterdam School of Management (RSM). (2009, March 27). MBA students move ‘towards

performance excellence’ with Jacques Kemp. Retrieved December 3, 2011, from

http://www.rsm.nl/home/news/detail?

Robbins, T. P., & Coulter, M. (2012). Management. (11 ed., pp. 264-291). Prentice Hall.

Schotter, A. (2006). ING Insurance Asia/Pacific. [Case study]. Ontario, Canada: Ivey

Publishing.

123HelpMe.com. (2011). ING insurance Asia/Pacific. Retrieved December 3, 2011, from

https://www.123helpme.com/ing-assurance-asiapacific-case-view.asp?id=165609