Corporate restructuring, ownership‐disciplined alignment, and the reorganization of management

Abstract Intensified focus on shareholder value during the 1980s led to a stress on consistent, integrated linkages among major elements of company organization. Drawing on senior management interviews and documents from six large publicly‐traded corporations and six small firms, we argue that this ownership‐disciplined alignment devolved decision‐making authority into operating business units; contracted headquarters' managers and staff functions; heightened stress on management selection; expanded use of performance‐based compensation; and created mechanisms for internal ownership. Changes in each area of managerial organization have appeared before, but they are now explicitly and systematically focused around enhancing shareholder value.