This research was made possible in part by a grant from the Strategy Research Center, Columbia University, Graduate School of Business. The author would like to thank Professors William H. Newman, William K. Brandt, James M. Hulbert, and Michael L. Tushman for their valuable comments and assistance during the study. This study attempts to extend current understanding of the relationship between an organization's structure and its strategy. The study uses an information-processing approach to develop a model for evaluating the goodness of fit between strategy and structure in multinational corporations. Hypotheses drawn from the model are tested with data from 34 U.S. and European multinationals. The hypotheses are generally confirmed, thus supporting both the importance of fit between strategy and structure in organizations and the value of the information-processing model as a means for better understanding the critical relationships between strategy and structure.
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