Divestitures: Creating Value Through Strategy, Structure, and Implementation

CHAPTER 10

Reconfiguring Internal Processes

INTRODUCTION

Divestitures require companies to adjust to the new reality that their organizations now consist of fewer businesses, with different opportunities, demands, people, and capabilities than they had prior to those transactions. This new reality typically manifests itself in two ways:

•   The scale of corporate resources, functions, and services that are retained post-divestiture may be too large relative to the new scope of these companies’ operations.

•   Certain businesses in these companies’ portfolios may have greater future growth prospects and hence, resource needs, than they did pre-divestiture.

Thus, when implementing divestitures, companies need to anticipate and respond to this ...