Asea Brown Bovery

Submitted to: Prof. Saptarshi Purkayastha,

Submitted by: Group 4

|Arathi Mohan |(PGP/17/260) |
|Deeksha |(PGP/17/265) |
|Dheeraj |(PGP/17/266) |
|Saurabh Chaudhary |(PGP/17/294) |
|Mitali Jain |(PGP/17/327) |
|Atul Bhargav |(PGP/17/316) |

What ABB’s strategy? Do you believe that the organization structure chosen by Barnevik is appropriate? Why or why not?

ABB with 1200 companies and with an average of 200 employees was led by Barnevik who had the responsibility of driving the 4500 profit centers successfully. He used the principal of being Global and Local ie, accountability and decentralization of operations as his strategic vision to drive the business. He laid out clear set of responsibilities, accountabilities and provided them with freedom to execute. His strategy are summed up below

1. To achieve economies of scale and scope by cutting cost by designating certain plants as specialized production sources. He also introduced cost saving measures of component sourcing and overhead cuts and inventory controls

2. Restructuring the ABB through series of acquisitions. He realized that the demand would grow for power transmission and in these situations to secure the deals having local presence would be very crucial. These steps caused industry wide consolidation of competitors.

3. Establishing accountability through strong central reporting and decentralization of business operations was to achieved through laying of clearly laid rules