Leadership succession in a merger of equals is an articles, which examines about the implications of leadership succession in an extreme form of mergers, a merger of equals, can yield important findings to better understand what allows some mergers to succeed while others fail (Cheng, 2012). Mergers and acquisitions are much common in these days and only a few of them are end up in successes. Even though mergers and acquisitions are not result much successes rate, many organizations are still preferring it because, it is used as a cooperative strategy but nowadays it is used for cooperative development. The cultural differences and merger integration can be considered as an important factor for the failure rate but this study mainly focused
The co-CEO is formed when there is a situation in merging where a firm can make a single CEO. Most part of this article is comparing leadership succession of different CEOs and co-CEO but end result is that leadership succession does not play much roles in the failure of the merging. This article is concluding that the choice of leadership succession is not important in how the merged company fares thereafter, even in such an extreme case as a mergers of equals. Nonetheless, the high failure rate of mergers remains, and so research should shift attention to other salient factors such as cultural and operational integration (Cheng, 2012). This article is supporting iGate Patni because, instead focusing about the choice of leadership succession, IGate focused on the factors such as cultural and operational integration which is the reason for their successes in merging with Patni.
IGate has a lot of outsourcing projects which are done in different firms. Due to high competition in the outsourcing field, iGate lost a lot of outsourcing opportunity, which created unemployment of iGate employees. When the crisis reached the maximum effect, most of employees left the company which creates stress among the remaining employees. Most of the employees lost their motivation to work, and managers from different division started fighting. This situation was temporary, because of the quick action of CEO Phaneesh Murthy. He solved this outsourcing problem by merging with an Indian based company Patni, which is three times bigger than his acquirer iGate. Patni was a pioneer in Indian IT services and famous for high volume, lower value work but their growth has been stalled in recent years. By merging with the Patni, IGate solved their outsourcing problem at same time it solved conflict that were happening in the company. This merging also motivates the employees of IGate because they became much bigger company. Here CEO Phaneesh Murthy was able to solve every problem in the IGate but the merging also created new problems. IGate and Patni are completely different firms, one is American based company and another is Indian based company, there are a lot of cultural difference between the two companies and also the operational methods are also different. The next challenge for
In the year of 2005, the companies eventually found a way to make it easier for the companies to combine without having any major issues or problems. Unfortunately, around the year of 20010 the merging com...
Emperor, and First Grand Secretary, I would like to praise you both in your quick, and industrious actions taken for the welfare of the Empire. I would also like to thank you both for taking such meticulous consideration of our memorials. Your fervent attempts are well respected and I can see the ways of Confucius guiding these principles. I urge you now to take the next step, dear Emperor, and address the issue of succession here in the Forbidden City. Choose Changlou, your firstborn, to ascend to the throne after your departure, and remove Lazy Zheng from the Forbidden City. If you are to do this, you, Emperor Wan Li, will solidify your position here as a man of Confucius ideal, and as a powerful efficient ruler. This will establish most trust among ourselves here, and therefore create a more unified government.
Gaughan, P. A., 2002. Mergers, Acquisitions, and Corporate restructuring. 3rd ed.New York: John Wiley & Sons, Inc.
McDonagh, K., Prybil, L., Totten, M. (2013). Leadership Succession Planning: A Governance Imperative. Trustee, 66(4), 15.
The scenario presented is the tale of Executive A planning to retire. Leader B and Leader C are in contention to move into the CEO position. When Executive A retires, there will be a change in company performance along with how employees react, as Leader B and Leader C have different leadership styles from Executive A.
Merging two companies does not exchange any cash between each other. Merging is usually done in free of cost; this is a likely reason for the high revenue made by the AT Kearney despites challenges faced to them.
...dditionally, the merger can take place in smaller phases. For instance the first phase may include change of the physical look of the branches and the signage - – so as to convey a consistent view and experience for its customers. This phase may also include effective communication to the employees to educate them about the merger, ensure them of their positions and encourage them to participate in the merger. Second, the firm can totally combine the bank’s technology and the information systems which will allow the merged firm to operate as a single entity and to become fully operational. The management should implement the merger with care and prudence, aiming for minimal disruption for the customers and should communicate extensively to ensure all its stakeholders are kept fully informed as they make changes.
is where a good leader intervenes and rebuilds communications and reestablishes missions and goals of the company with his team members. He must provide a clear vision of the goals. If leaders fail to take action at this very step, employees will begin to leave their current employer and migrate toward the other company or tribe. Leaders can not expect that
The soft factors can make or break a successful change process, since new structures and strategies are difficult to build upon inappropriate cultures and values. These problems often come up in the dissatisfying results of spectacular mega-mergers. The lack of success and synergies in such mergers is often based in a clash of completely different cultures, values, and styles, which make it difficult to establish effective common systems and structuresBased on the case study, extensive research and annual reports of AT&T the writer has mapped AT&T in the different domains. AT&T should strive to attain a perfect circle as close to the centre as possible, which indicates total synergy, order and equilibrium. Where the circle is skewed drastic change is needed as it moves closer to the outer ring of chaos:
That brings a great challenge to succeed, and lets the leadership work in new and innovative ways to make such a merger successful. McClelland’s theory states, in regards to the need for achievement, that people strive “To excel one’s self.to rival and surpass others. to increase self-regard by the successful exercise of talent” (Kreitner & Kinicki, 2010, p. 215). By this definition, the merger would motivate leadership to excel in the face of a challenge, and to increase their professional self-regard in their success in doing so. On an individual level, you are asking the performers and employees to recognize both economic and social climates, and to come together in action to save both their careers, as well as their passion for life....
He had a keen interest in working in the Pacific Rim for which he was eventually rewarded a position of Chairman on Board (COB) at the Factory in China. What we noticed is that due to Control's relative inexperience and lack of understanding of joint venture, James was recalled only after completing one third of his contract length, to be replaced by a relatively inexperienced employee from Singapore (Jimmy Chao). Controls Asia Pacific, in doing so, ignored the fact that they might threaten the success of the joint venture. This case shall try and analyze what factors may have caused this pull out to occur, what may be its consequences, and what we feel should be done, in order to reinstate trust and confidence to make the joint venture a success. Adaptation, Acceptance and Experience.
At a macro level as a result of the acquisition the combined size of Turner & Townsend Thinc was considered to be of strategic benefit to both firms. While there have been no official mass redundancies, role duplication has resulted in early retirement and resignations. However, the common problem faced after the acquisition is power struggles, excessive overhead, bureaucracy, uncontrolled layering, and decision strangulation.
However, during the 1990s, Philips and Matsushita both faced major challenges to sustain their position in the market. Changing profile of the industry and globalization forces made Philips and Matsushita’s organizational models and competitive advantages obsolete, and brought up the need for drastic actions. At the brink of a new century, the battle of two giants unraveled with CEOs from both sides implementing another round of strategic initiatives and restructurings. The pressure put on new CEOs was enormous – wrong st...
The primary research and research done afterward was evident enough that the countries have different cultures and those cultures impact the standardization of way of work within the large organizations. The examples quoted by Hofstede demonstrate the difference of cultures among different countries. These areas were overlooked before by other researchers and practitioners but these were the main factors to consider. According to a KPMG study, "83% of all mergers and acquisitions (M&A 's) failed to produce any benefit for the shareholders, and over half actually destroyed value. Cultural preferences have been identified as an often overlooked barrier to the effective implementation of mergers and acquisitions. In the following the four factors are briefed in
When entrepreneurs plan their business future they will consider how they can increase their business size or profit in a short period. Entrepreneurs may consider growing their business or company by using a merger or an acquisition. These methods can be a speed up tool and a short cut to enlarge their business. (Burns, 2011) Also they can reduce competition, make it easier for entrepreneurs to think about the market and product development and risk reduction. Furthermore, some lesser – known companies can improve their firm’s image and market power by using merger and acquisition with larger firms. However, there may be risks associated with merger and acquisition related to lack of finance and time. (Burns, 2011) This essay will discuss more deeply the advantages and disadvantages of using mergers and acquisitions, showing how it can affect firms and market with the case study.