Model for Merger Management - This is a work in progress!!
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1. The document discusses factors that influence the integration process of mergers, including the level and speed of integration, acculturation between the organizations, and the fit between the organizational cultures. 2. It examines target organization variables such as the degree of relatedness between the companies, their organizational architectures, performance differences, and previous acquisition experience. 3. Culture is discussed at different levels, from general to organizational to national culture, and how the integration process can manage or transform cultures during a merger.
![3. CultureGeneral cultureOrganization cultureNational cultureCulture Development (Schein , Edgar H . Organizational culture & leadership [Web log message]. Retrieved from http://www.tnellen.com/ted/tc/schein.html)](https://image.slidesharecdn.com/mergermodel-110909082814-phpapp02/85/Model-for-Merger-Management-This-is-a-work-in-progress-16-320.jpg)
Model for Merger Management - This is a work in progress!!
- 1. 5. Integration Process Variables:Level of integrationSpeed of integrationAcculturationAutonomy RemovalCommunication qualitySocial Integration Mechanisms6. Integration ProcessStrategy integrationStructure IntegrationHuman IntegrationProcess IntegrationTask IntegrationProcedural Integration4. Org.Fit2. Target Organizations VariablesDegree of relatednessOrganizational architecturePerformance differencesApproachAcquisition./merger experience3. CultureGeneral cultureOrganization cultureNational culture1. Strategic Intent
- 3. Strategic IntentThe Case for the Merger
- 4. 2. Target Organizations Variables
- 5. 2. Target Organizations VariablesDegree of relatednessThe relatedness/ relatedness bring different synergies that can be generated:Relatedness is usually considered against the background of the following:Similarity of production technologiesSimilarity of research processesSimilarities in terms of products and/or service offeringSimilarities in term s of marketsRelatedness generate the following potential synergies:Economies of scaleEconomies of scopeMarket powerRelatedness is considered to generate other synergies such as administrative efficiencies, dominance due to size of firm, improved human capacity etc
- 6. 2. Target Organizations VariablesDegree of relatednessOrganizational architecture Do the companies differ in terms of the span of control and degree of decision-making?Does the decision-making leeway, in terms of profit and cost centres, differ between buyer and target?How dissimilar are the compensation and incentive structures (e.g., the variable portion of remuneration)?What differences exist in core processes and functions such as market development, order processing, production of goods and services or extent of outsourcing?Post Merger Integration:Hard Data, Hard TruthsBY Johannes Gerds and Freddy Strottmannwith PakshalikaJayaprakash > Illustration by vincemcindoe
- 7. 2. Target Organizations VariablesDegree of relatednessOrganizational architecturePerformanceMerger approachVery little in terms of how performance
- 8. Influence the merger decision making process.
- 9. However the diagram below provide an intuitive view:Performance Firm APerformance Firm B
- 10. 2. Target Organizations VariablesDegree of relatednessOrganizational architecturePerformanceApproachAcquisition experienceStudies show mixed results in terms of performance of firmsWith less or more acquisition or merger experience. Few showThe relationship consequences, as modelled here:Previous ExperienceFirm APrevious Experience The influence of organizational acquisition experience on acquisition performance: a behavioral learning perspectiveby JerayrHaleblian, Sydney Finkelstein Firm B
- 11. 3. Culture
- 12. 3. CultureGeneral cultureOrganization cultureNational cultureCan be “managed”However almost always followsSymbolsHero'sRitualsPracticesValuesCannot be “managed”Domain of transformation Transformational LeadershipCultures and Organizations:Software of the MindBy Geert HofstedePresented by: Natalie Balaziuk, Beth Roszkowski, Michelle Yeager
- 13. 3. CultureGeneral cultureOrganization cultureNational cultureWhat Culture is Transferred WhenAge:01020Culture:GenderFamily/Social classNationalOccupationalOrganizationalVALUESPRACTICES
- 14. 3. CultureGeneral cultureOrganization cultureNational culture
- 15. 3. CultureGeneral cultureOrganization cultureNational culture
- 16. 3. CultureGeneral cultureOrganization cultureNational cultureCulture Development (Schein , Edgar H . Organizational culture & leadership [Web log message]. Retrieved from http://www.tnellen.com/ted/tc/schein.html)
- 17. Visible symbolsHistories & storiesARTIFACTSSlogansBehavioursDress codesOrganisational structures & processesRituals & CeremoniesHeroes & LegendsLanguagesCore valuesStrategiesESPOUSED VALUESBeliefsGoalsPhilosophiesAttitudesUnconscious beliefsShare assumptionsUnconscious thoughtsBASIC UNDERLYING ASSUMPTIONSUnconscious feelingsUnconscious perceptionsAdopted from Schein, E.H. Organizational Culture and Leadership, Jossey-Bass, San Francisco, 1992, Figure 9
- 18. Organizational FitGo – No Go Decision and Integration Planning
- 19. 5. Integration Process Variables:Level of integrationHighNeed For Organizational AutonomyTolerance For MulticulturalNeed for Strategic InterdependenceDegree of RelatednessLowHigh
- 20. 5. Integration Process Variables:Level of integrationSpeed of integrationExpectations Tend to OutpaceValue RealizationPotential ConflictExpectations/Value RealizationTime
- 21. 5. Integration Process Variables:Level of integrationSpeed of integrationAcculturation