Hershey Needs Your Assistance In Developing A Clear Organiza

Hershey Needs Your Assistance In Developing A Clear Organizational Cha

Hershey needs your assistance in developing a clear organizational chart. Some of its top executives believe the company needs a divisional by product type structure, and others believe the firm needs a divisional by geographic type structure. Hershey makes such well-known chocolate and candy brands as Hershey’s Kisses, Reese’s peanut butter cups, Twizzlers licorice, Mounds, and York Peppermint Patty. Hershey also makes grocery goods such as baking chocolate, ice cream toppings, chocolate syrup, cocoa mix, cookies, snack nuts, hard candies, and lollipops. Its products are sold throughout North America and exported overseas.

Currently Hershey’s top executives have the following titles: CEO and President of North American Commercial Group EVP and COO SVP and CFO SVP and President of Hershey International SVP for Strategy and Business Development SVP of Global Operations SVP, General Counsel, and Secretary VP of Global R&D VP of Investor Relation VP of Global Innovation VP of Corporation Communication.

Paper For Above instruction

Introduction

Organizational structure plays a vital role in determining a company's efficiency, adaptability, and overall success. Hershey, being a major player in the confectionery and grocery industry, must adopt an organizational structure that aligns with its operational scope, product diversity, and geographic reach. This paper aims to construct an organizational chart based on the provided executive titles and then analyze whether Hershey would benefit more from a divisional-by-product or divisional-by-geographic structure, supported by insights from credible sources.

Construction of the Current Organizational Chart

Based on the executive titles provided, Hershey's organizational chart can be depicted with the CEO and President at the apex, overseeing various executive roles that manage different facets of the company's operations. Under the CEO, there would be a Chief Operating Officer (COO), Chief Financial Officer (CFO), and others, each operating within their respective domains.

- At the top: CEO and President of North American Commercial Group

- Directly reporting to the CEO are:

- EVP and COO

- SVP and CFO

- SVP and President of Hershey International

- SVP for Strategy and Business Development

- SVP of Global Operations

- SVP, General Counsel, and Secretary

- VP of Global R&D

- VP of Investor Relations

- VP of Global Innovation

- VP of Corporate Communication

This structure suggests a centralized leadership with specialized VPs and SVPs managing global functions, regional operations, R&D, strategy, and communication.

Analysis of Organizational Design: Product vs. Geographic Divisions

Hershey operates in diverse markets with a wide array of products across different regions. The choice between a divisional-by-product structure or a divisional-by-geographic structure hinges on several factors:

Divisional-by-Product Structure

This structure groups activities based on product lines, such as chocolates, candies, grocery goods, and snacks. The benefits include:

- Focused expertise on specific products, leading to innovation and quality improvement.

- Clear accountability for product performance.

- Efficient resource allocation for product development and marketing.

However, it may lead to duplication of functions and increased operational costs due to overlapping resources.

Divisional-by-Geographic Structure

This design segments the organization based on geographic regions, such as North America, Europe, Asia, etc. Benefits include:

- Better responsiveness to local market preferences and regulations.

- Tailored marketing strategies suited to regional tastes.

- Enhanced logistical efficiency within regions.

Drawbacks involve potential fragmentation and less focus on product innovation across the entire organization.

Recommendations Based on Hershey's Business Scope

Considering Hershey's extensive product portfolio and global presence, a hybrid organizational structure might be optimal. However, focusing primarily on the nature of its core operations, a divisional-by-product structure would allow Hershey to capitalize on brand recognition and innovation within specific product categories. This aligns with the company's strategy to innovate and differentiate its product offerings. Simultaneously, regional offices can support marketing and sales efforts locally, maintaining an overlay of geographic consideration.

Research indicates that companies with diversified product lines, such as Hershey, often benefit from product-based divisions for operational clarity and strategic focus (Galbraith, 2014). Yet, regional segmentation should not be neglected as it can improve market-specific adaptations, especially considering cultural differences influencing consumer preferences.

Recommended Organizational Structure Diagram

Based on the analysis, the recommended organizational chart consists of a divisional-by-product structure with regional managers overseeing each product division to align with local markets. The structure would feature divisions such as:

- Confectionery Division (including Hershey’s Kisses, Reese’s, Twizzlers, Mounds, York)

- Grocery Goods Division (baking chocolate, syrups, cocoa, cookies)

- Snacks Division (nuts, chips)

- International Operations Regional Division

- North American Commercial Division

Each division would have its own management team responsible for product innovation, marketing, and sales, reporting to a central corporate leadership aligned with Hershey's strategic vision.

Conclusion

Hershey’s current organizational structure, based on the executive titles, indicates a functional model with regional and global specialization. Given its diverse product offerings and international footprint, adopting a divisional-by-product structure supplemented by regional oversight appears most advantageous. Such a hybrid approach combines the benefits of product specialization with regional responsiveness, ultimately supporting Hershey’s growth, innovation, and market adaptation.

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