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Literature review on employee engagement
Employee engagement theory literature review
Employee engagement theory literature review
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Mergers and acquisitions represent a major source of organizational change. If companies can identify the need for change, design the changes required and implement them effectively and efficiently, they would be more likely to survive and prosper. However, problems can occur with M&A such as commitment and engagement disintegrate during the process and a bond is unlikely to form immediately with and for a new organization (Pierse, 2012). The purpose of this paper is to study the concept of M&A and its impacts on Employee engagement in the first part. Then, the objectives are to find out the major issues associated with post merging situations with special emphasis on the human aspect. To finish this analysis, the document will provide some best practices and describe main challenges to fit with the new organization with the actions of different actors. Main Points The importance of the Human factor Definitions Definition of Mergers and Acquisitions (M&A): A merger or an acquisition can be defined as the combination of two or more companies into one new company or corporation. The main difference between a merger and an acquisition lies in the way in which the combination of the two companies is brought about. Mergers occurs when two companies combine their operations and participate as equal partners in order to achieve strategic and business objectives (Sudarsanam, 2003). Whereas, an acquisition occurs when one company takes over a second one - can be friendly or hostile - and obtains control to determine how the combined operations will be managed (Shook & Roth, 2010). M&A are rational and strategic alliances that are conducted in the best interest of the organization and its shareholders in order to improve the financial ... ... middle of paper ... ...tivity and finance). A clear expression of the values and the new corporate culture will lead to the optimal culture state needed to have a successful business. The change plan should detail the actions and processes that will create a unified, invigorated, engaged and committed workforce. Effective communication is a powerful tool for supporting and accelerating organizational change. The investment of time, energy and resources in communication not only wins the hearts and minds of employees but inspires greater productivity with a direct and immediate impact on the bottom line. Leadership: “Employee engagement tends to improve when HR and line management follow good practice principles” (Rankin, 2008). Transformational leadership will be positively associated with employee post-merger satisfaction and become a trigger of change which encourage people to openness.
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
Workers feeling, which includes competitive compensation and reward strategies, professional growth and development, career paths and succession plans and the organizations leadership and culture are contributing factors of employee engagement
Consultation and analysis of previous similar cases is important in handling a large merge of the magnitude presented here. From the way the new management of American Airline is handling the case, it is evident that that they must have consulted extensively and studied previous mergers. This is a major case study for mergers.
The September Duke University/CFO Business Outlook survey indicates that three-quarters of the CFOs surveyed expect M&A activity to slow. Of particular interest is the suddenness of this change in expectations. In the prior quarter’s survey, the majority of surveyed CFOs expected M&A to “stay strong through the remainder of 2007.”
A merger is a partial or total combination of two separate business firms and forming of a new one. There are predominantly two kinds of mergers: partial and complete. Partial merger usually involves the combination of joint ventures and inter-corporate stock purchases. Complete mergers are results in blending of identities and the creation of a single succeeding firm. (Hicks, 2012, p 491). Mergers in the healthcare sector, particularly horizontal hospital mergers wherein two or more hospitals merge into a single corporation, are increasing both in frequency and importance. (Gaughan, 2002). This paper is an attempt to study the impact of the merger of two competing healthcare organization and will also attempt to propose appropriate clinical and managerial interventions.
To examine the impacts of a merger and determine if communication with employees could mitigate the expected negative effects of mergers and acquisition on them, a field experiment was conducted with the focus to provide a clearer picture of the effects over time of the merger and communication with employees.
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.
A merge may expand two companies' marketing and distribution, giving them new sales opportunities. A merger can also improve a company's standing in the investment community: bigger firms often have an easier time raising capital than smaller ones. One of the more successful acquisition strategies is to examine other businesses to see if there are costs that can be stripped out or revenue advantages to be gained by combining the companies. Ideally, the result should be greater profitability than the two companies would normally have achieved if they had continued to operate as separate entities.
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:
According to Investopedia.com (2014), “[…] a merger is a deal to unite two existing companies into one new company […]”. There are 5 main types of merger: conglomerate, horizontal, market extension, product extension, and vertical. In a conglomerate merger, none of the companies to be united has anything in common. In a horizontal merger, the companies to be merged are in same industry, and the deal is part of a consolidation. In a market extension merger, the companies sell same products but compete in different markets. In a product extension merger, companies add together products that go well together. In a vertical merger, the companies make parts for a finished good combine. Among the mergers that I researched, the one that caught my eye the
An acquisition can be defined as the consolidation of companies or assets. This is basically when one company is purchased by another and as a result, no new company is formed. There are several different drivers of a successful acquisition; these comprise of due diligence, strategic drivers, and aligning cultures.
In speaking with her staff, Anne needs to set very clear and obtainable goals to help motivate her employees. Kreitner and Kinicki (2010, p. 228), in speaking about how goals regulate effort, state that “Not only do goals make us selectively perceptive, they also motivate us to act…Generally, the level of effort expended is proportionate to the difficulty of the goal”. With this in mind, she should set challenging goals, and lead her organization to accept the merger with motivation.
Mergers usually take place when companies are struggling on their own, but find hope and comfort in uniting with another company. This unite is a great way to create new companies, combine revenues, establishing new policies, procedures, and objectives. It also opens up new doors, and allows new companies to expand in so many different aspects of their business. Part of the mergering phrase should include the planning process to assist with determining the objectives of the business’ long term investments goals. This could also open up the door for new products, new machinery, new plants, replacement of machinery, new locations, new projects, as well as the tangible and intangible things both companies already have.
Merger is a process when at least two companies combine to form one single company.
A number of reasons provide sanction for a corporate merger and acquisition, not all of which are necessarily financial in nature. Moreover, M&A is within the scope of the Board of Directors to pursue (1) and the company executives to initiate and execute. Since board members may also be subject to political, social, and personal interests, decisions seemingly in favor of the shareholders may also become quagmire with additional factors. According to Investopedia.com, an estimated 66% of mergers and acquisitions are not successful because of M&A intent. Of the 33% that are considered successful, the mergers and acquisitions achieved a net gain from the M&A with our without bad M&A intent. A number of reasons for the majority of failures exist in addition to the failures themselves indicating a potential disadvantage of M&A activity is a relatively high risk of failure.(www.investopedia.com). In some cases, mergers and acquisitions may not only disadvantage the shareholders but consumers as well. In both cases, this may happen when the newly formed company becomes a large oligopoly or monopoly. Moreover, when higher pricing power emerges from reduced competition, consumers may be financially disadvantaged. There are some potential disadvantages facing consumers though. One of which is increase in cost to consumers. Another is the decrease of corporate performance and services. Suppression of competing businesses is another disadvantage. Shareholders may also be disadvantaged by corporate leadership if it becomes too content or complacent with its market positioning. In other words, when M&A activity reduces industry competition and produces a powerful and influential corporate entity, that company may suffer from non-competitive stimulus and lowered share prices. Lower share prices and equity valuations may also arise from the merger itself being a short-term disadvantage to the