1. How should Svanberg go about reorganizing Ericsson’s marketing, sales and R&D? How much should they be centralized or decentralized? What would be the likely consequences of such actions?
In terms of marketing, a more centralized approach would be preferable. The function should probably reside at the top level of the company, allowing for synergy and marketing of complete solutions in a unified way, whereas market-specific communication would be wasteful in terms of recreating the same messages multiple times. Another approach would be moving the marketing functions into each business unit; however this again does not support the diverse nature of the company. Either solution helps reduce overhead costs and streamline communication; however with different focuses depending on how much actual crossover there is in the marketing communication between different solutions.
The sales side needs its own administrative layer. The current style of direct CEO involvement was more befitting Hellström, who came from a sales background. Not only could the operations do with a more sales-centric person overseeing this part of the business, but the CEO is already extremely taxed by the need to involve himself in the details of the R&D decisions and otherwise the broad scope of the company. Taking the direct responsibility of sales away from the CEO and making it a separate function would free up valuable CEO time, which would help assure the company stays on the right course. It would also reinvigorate the sales efforts, which could foreseeably work together more closely with the marketing division.
R&D is the cornerstone of the company; however Svanberg is correct in that there is much to be done to rationalize the process. New ideas should be cultivated, but also assessed at frequent intervals to determine which set number of ventures to prioritize going