The diversity of our products requires that we reorganize along our major product lines. Toward this end I have established three new divisions: commercial jet engines, military jet engines, and utility turbines. Each division will be headed by a new vice president who will report directly to me. I believe that this new approach will enhance our performance through the commitment of individual managers. It should also help us to identify unprofitable areas where the special attention of management may be required.
For the most part, each division will be able to operate independently. That is, each will have its own engineering, manufacturing, accounting departments, etc. In some cases, however, it will be necessary for a division to utilize the services of other divisions or departments. This is necessary because the complete servicing with individual divisional staff would result in unjustifiable additional staffing and facilities.
The old companywide laboratory was one such service department. Functionally it continued to support all of the major divisions. Administratively, however, the manager of the laboratory reported to the manager of manufacturing in the military jet engine division.