Originally, Sean and Tommy founded Nestel Co. with an idea for

a peach drink. In the company's early days, the two ran the entire

operation on their own. These days, Nestel has more than 150

employees split between headquarters in Malaysia and Singapore,

and several field offices.

As a result, management has developed a more formalized

organization structure to keep the business running smoothly, and

the president says that he has many managers reporting to him.

The company relies on cross-functional teams to handle special

projects such as the implementation of new accounting software.

These strategies have helped Nestel successfully manage its rapid

growth.

a) Nestel may need to change its organization structure as it expands

into new products and new markets. Under what circumstances would

some forms of departmentalization be appropriate for the company?

Explain. (15 marks)

b )Assume that Nestel is purchasing a well-established beverage

company with a tall structure stressing top-down control. What are

some of the problems that the management might face in integrating

the acquired firm into the existing organization structure of Nestel?

Explain.