Strategy and Competitiveness in Latin American Markets
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Strategy and Competitiveness in Latin American Markets

The Sustainability Frontier

Edited by Urs P. Jäger and Vijay Sathe

Using a combination of thorough research and practical examples, Strategy and Competitiveness in Latin American Markets explains how the concept of the sustainability frontier that the book develops resolves the long-running debate on whether sustainability requires tradeoffs or not. Through its exploration of a variety of sustainability challenges and opportunities, along with various sustainability models, the authors show how the sustainability frontier can be expanded through disruptive innovation, the building of new skills and by other means to secure no-trade off solutions.
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Chapter 9: Governance and structure

John Ickis and Andrea M. Prado


An organization must perform with excellence in multiple dimensions to reach the sustainability frontier, and this requires the choice of an appropriate governance and organizational structure. In Latin America, governance continues to rest primarily with the family, which may be a source of strength and continuity or a constraint on growth and innovation. A challenge that faces the increasing number of Latin American firms that pursue sustainability goals is how to reorganize the family business to achieve these goals without sacrificing economic performance. How to meet this challenge is the subject of this chapter. The first section of this chapter is a brief review of the basic forms of organizational structure and their interplay with business strategy. The second section traces the evolution of organizational structures in Latin American enterprises from their origins in centralized family businesses to the formation of multi-divisional family groups as the companies grew and diversified. The third section describes responses by these companies to forces for change: the creation of local business schools and the emergence of a new class of professional managers in the 1960s, the social convulsions of the 1970s leading to the ‘lost decade’ of the 1980s, and the development of an agenda of ‘competitiveness and sustainable development’ by local business leaders in the 1990s, which persists today despite economic shocks and social upheavals.

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