1. Summary of Article
The journal article by David and Goliath inspect on the issue on merger and acquisitions of an organisation and concerned with communication between employees and top management.
The article also examine on various collections of data that changes show beforehand results in reduced adverse effect of the merger.
Communication is the important way to help management to reduce employee’s anxiety and doubt that follows by the cause of the merger. Foreseeable change should be conveying to employees rapidly to prevent negative feelings such as stress, job dissatisfaction and low commitment to work. Studies show that communication increased employee’s performance and lessen their uncertainty.
Another customized methods are realistic job preview, the main functions is to reduce new employee’s anxiety by clarifying their performance expectation and guide them in the change to their new jobs. It provides complete and detailed information such as positive and negative aspect about the job. This make new employee feels more convinced with their job, less likely to quit and committed to the organisation. Communication plays a role in the new employees change process as well.
Even though above mentioned methods are a source of uncertainty for employees, there are no empirical evidence justify this idea.
The present study in the article was to conclude if mergers and acquisitions activity does produce uncertainty and others negative result. In this case, a communication program based on model of realistic job preview is to test the whether the program could lessen the negative effects of the mergers and acquisitions on employees.
Hence, an experiment called realistic merger preview was to provide a clear illustration of the effects on mergers and communication program. Two types of plants were tested, an experimental plant in which the realistic job preview was introduced and a control plant in which the merger was controlled more rigidly. Data were collected at four different points to test the hypotheses.
Overall, there is no empirical evidence to support the hypotheses but it will help employees to tackle the problems and maintain it after the preview has taken place.
2. Brief review of Case Study
Bushwhacker Mining Pty. Ltd and Coogan River Ltd. (CRL) was both a mining industry company. Bushwhacker was a small, developing and well-known gold mining company that was highly look upon for its power to render unprofitable contract renting buildings into good earners. Unlike Bushwhacker, CRL was a large company with interests in iron ore, petroleum, gold and copper. CRL depend heavily on its iron ore business because the transparent size of this small surface of its operation leads to short-term losses. Bushwhacker, nevertheless, was in a more risk position because it was always at the downside of the gold price. The decreasing price of the gold was always a good long-term offering with long-term contracts...