Corning Glass Work Case Study
CORNINGS GLASS WORKS CASE STUDY
1. Enumerate the conditions why Corning had to undergo the series of structural changes.
Following the international growth and expansion of Corning, the following problems were being faced in the organization’s structure and management processes:
i) With the international expansion of CGW, the company was becoming too big and complex to be managed by its current structure. Hence a need was felt to create the international arm as a separate legal entity and hence Corning International Corporation (CIC) was born.
ii) CIC was created as a subsidiary to CGW to emphasize the growing importance of Corning’s overseas business. The management felt that the creation of CIC as a separate unit was important to upgrade the role of international managers and help them feel more accepted within Corning.
iii) Before the international strategy shift of the mid 1960s, CGW did not meddle much into the affairs of its foreign affiliates. The foreign affiliates maintained their own individual reporting and control systems. However, following the strategic shift to gain majority in these foreign subsidiaries, the management system and processes began changing, such as integration of subsidiaries’ accounting systems into the parent company. This caused problems as most of the subsidiaries were European non-English speaking countries and didn’t follow American standards. Hence a need was felt to integrate these foreign subsidiaries with the parent company so as to maintain uniform standards and processes.
iv) The acquisition of majority shareholdings in foreign subsidiaries also encouraged management to begin to coordinate and integrate its foreign operations. The task of unifying, coordinating and integrating the European operations specially was a difficult one. There was a long list of independent companies that needed to be brought under control and a lot of these companies were old rivals. Hence lack of
1. Enumerate the conditions why Corning had to undergo the series of structural changes.
Following the international growth and expansion of Corning, the following problems were being faced in the organization’s structure and management processes:
i) With the international expansion of CGW, the company was becoming too big and complex to be managed by its current structure. Hence a need was felt to create the international arm as a separate legal entity and hence Corning International Corporation (CIC) was born.
ii) CIC was created as a subsidiary to CGW to emphasize the growing importance of Corning’s overseas business. The management felt that the creation of CIC as a separate unit was important to upgrade the role of international managers and help them feel more accepted within Corning.
iii) Before the international strategy shift of the mid 1960s, CGW did not meddle much into the affairs of its foreign affiliates. The foreign affiliates maintained their own individual reporting and control systems. However, following the strategic shift to gain majority in these foreign subsidiaries, the management system and processes began changing, such as integration of subsidiaries’ accounting systems into the parent company. This caused problems as most of the subsidiaries were European non-English speaking countries and didn’t follow American standards. Hence a need was felt to integrate these foreign subsidiaries with the parent company so as to maintain uniform standards and processes.
iv) The acquisition of majority shareholdings in foreign subsidiaries also encouraged management to begin to coordinate and integrate its foreign operations. The task of unifying, coordinating and integrating the European operations specially was a difficult one. There was a long list of independent companies that needed to be brought under control and a lot of these companies were old rivals. Hence lack of