Royal Dutch Shell p.l.c. is one of the six “supermajor” oil and gas companies. Shell is unique for its organizational structure and its global presence. It was characterized as one of the world’s three most international organizations. Shell’s organizational structure is very complex. It is comprised of four types of companies: the parent companies, the group holding companies, the service companies, and the operating companies. Shell created a tri-dimensional matrix structure known as the Shell Matrix, which had functions, regions, and sectors. In 1995, a radical reorganization of Shell was announced. The new structure represented the move from a geographically-based company to a business sector-based firm. The restructuring also included the elimination of more than 1,000 corporate positions, the sale of a vast majority of its headquarters, and the redesign of its coordination and control systems.

Questions: What are some advantages and disadvantages of the Shell Matrix? Why do you think Shell has undergone so many organizational restructurings? How would you decide what would be Shell’s best organizational structure?