Elevating Regional Authority: KONE Corporation's Effort to Implement Effective Regional Management

Kone is a large industrial corporation based in Finland, mainly producing escalators and elevators. Due to strong internationalization via acquisitions and internal growth Kone spread quickly and, today, it covers all of the important regions of the world. The case focuses on how regional management is introduced and changed over the 40-year period between early internationalization and 2008. It features differences between different regions of the world, especially between Europe and the Asia-Pacific region, as well as different approaches and problems to managing the regions. At the end of the case text period, Tarmo, a board-level director of Kone with long-standing experience within the firm, is faced with the task of analyzing how regional management has changed over time and recommending changes to the current structure. He faces the dilemma that more regional resources and decision making rights seem necessary while many in the firm fear increasing regional overhead costs and power struggles.