This paper presents the results of an empirical study on the relationship between internal structural change and performance, in a sample of 138 large U.K. companies, 1959-1976. The paper considers the introduction of the multidivisional form (M-form) within the sample and addresses itself to three principal questions:
Firstly, whether re-organization to an M-form structure followed a significant decline in the performance of the firm?
Secondly, whether M-form adoption was followed by a significant improvement in performance?
Finally, was the performance impact, if any, of re-organization related in a systematic way to firm characteristics — e.g. size, diversification etc. — in a manner consistent with the M-form hypothesis?