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Organizational Behavioral Application In Mergers. Essay

2375 words - 10 pages

AbstractThe scope of organizational behavior for a manager goes beyond carving strategies for the functioning of the organization, and can extend further during and after acquisitions to extend financial benefits. The merger is the combination of two companies to form a new company. A manager has an important responsibility to develop a leadership plan while keeping human elements that arise from such mergers in mind. To create this balanced equilibrium, the manager uses transition strategies of organizational behavior to keep the vision and goals of the organization while motivating and achieving better individual performances.Organizational Behavioral Application in MergersMany larger companies are moving into new markets by buying smaller companies that already exist in the industry. A merger is a transaction involving two or more corporations in which stock is exchanged, but from which only one corporation survives. Mergers usually occur between firms of somewhat similar size and are usually "friendly." The resulting firm is likely to have a name derived from its composite firms.Recently, PeopleSoft announced that its shareholders had approved the acquisition of ORACLE. Instead of the hostile takeover of PeopleSoft by ORACLE, the two are merging. Both companies posses strength in the people management software industry. People Soft, after its acquisition of J.D. Edwards, became the second largest enterprise application software company in the world (People Soft Corporate Backgounder). Oracle, another computer software company, known for its innovations, has recently upgraded technologies to include Identity Management Services (Vijayan, 2003). Both companies stand to gain a large chunk of industry business and profits from the merger.The person responsible for a department (a departmental manager) can oversee department's performance measures and can effectively deal with the human situations in a corporate merger. Certain human elements in such situation can be objectively investigated by the departmental manager. An analysis of similar situations in other companies and asking questions to investigate the issue can make the merging process easy. Evidence has shown that involving Human Resource Professionals at the earliest stages of a merger or acquisition is crucial to help employees adapt to the change (Arkin, 2003).The most critical and difficult organizational behavior issues like employee related communication, rewards and talent management, and cultural integration are important from the management perspective when addressing the merger. These cultural issues can have a huge impact on employee satisfaction and are often overlooked. For example, the location of the "home office" can mean relocation for the employees of the acquired company. Global mergers complicate matters even more due to the different cultural expectations regarding holidays etc (Arkin. 2003). The merger's success depends on the effective strategic analysis combined...

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