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Types of Strategic
Restructuring
Parent-subsidiary Structure
A parent-subsidiary structure is an integration that combines some
of the partners' administrative functions and programmatic services. The
goal is to increase the administrative efficiency and program quality of
one or more organizations through the creation of a new organization(s)
or designation of an existing organization(s) ("parent") to oversee
administrative functions and programmatic services of other organization(s)
("subsidiary"). Although the visibility and identity of the original
organizations often remain intact in a parent-subsidiary relationship,
some organizations involved in such restructurings consolidate to the point
where they look and function much like a merged organization. For example,
a Boys and Girls Club and a YMCA in Maine formed a parent-subsidiary structure
that functions much like a merger, but allows both partners to maintain
their corporate structures, and thus their original endowments. Two multipurpose
mental health agencies in Ohio, on the other hand, formed a parent-subsidiary
structure that preserved more of each organization's programmatic autonomy,
while allowing the partners to pursue some programmatic goals together,
and providing improved administrative support and financial stability to
the subsidiary.
For more information, see these Case
Studies on Parent-Subsidiaries.
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What
form of Strategic Restructuring is Right For Us?