The purpose of this assignment is a critical review of company mergers and acquisitions regarding different human resource management related aspects. It will be analysed what impacts a merger might have on the organisational structure, on the human resource management strategy and on the required approach regarding intercultural management of the newly created company in relation to the current situation of the merging companies. In addition to that it will be analysed which impact a merger has on the motivation system, the change- and conflict-management and on the human resource management accounting system.
Based on practical merger examples the problems of these areas will be described and analysed and a recommendation for solutions will be given when possible. This assignment will give an overview about the human resource related problems and aspects, which companies will face and should consider when a merger is planned.
The definition of mergers and acquisitions (M&A) is not absolutely clear in the literature. On one hand side a merger is described as the legal and economical connection of two equal companies of the same size, which can be defined as a classic amalgamation, and an acquisition is described as an economical take over of a small company by a big one.1
On the other hand side the subject M&A also includes the sale of companies, splitting of companies (Asset Stripping), restructurings, spin-offs, joint ventures and alliances.2 Based on this it is not clear if a merger is the same as an amalgamation. Although the Daimler-Chrysler deal and the Renault-Nissan deal are defined and described as mergers it is not obvious if these were classical amalgamations or more acquisitions communicated and presented as mergers.3
According to the purpose of this assignment mergers are defined as classic amalgamation and a share or asset based acquisition.
The important item here is that companies with different cultures and backgrounds merge together and have to find a common identity including the consideration of the identities of the merging partners.
In the last years a lot of big and small mergers took place between companies from very different countries and cultures.
[...]
______
1 Compare: http://www.flexible-unternehmen.de/kl0908.htm, Jörg Wirtgen
2 Compare course material: Financial Management Module M&A, Dr. Frere
3 Compare: http://www.businessweek.com/2000/00_23/b3684147.htm
Table of Contents
1 INTRODUCTION
2 ELEMENTS OF HRM
2.1 ORGANISATIONAL STRUCTURE
2.2 STRATEGIC HRM
2.3 INTERCULTURAL MANAGEMENT
2.4 MOTIVATION SYSTEMS
2.5 CHANGE PROCESS AND CONFLICT MANAGEMENT
2.6 HUMAN RESOURCE ACCOUNTING
3 CONCLUSION
Objectives and Topics
This work provides a critical review of human resource management (HRM) challenges during company mergers and acquisitions (M&A). The central research focus is to analyze how M&A activities impact organizational structures, HRM strategies, intercultural management, motivation systems, conflict management, and human resource accounting.
- Strategic alignment of HRM policies during merger phases.
- Managing cultural integration and minimizing employee resistance.
- Strategies for maintaining motivation amidst organizational uncertainty.
- Assessing the value of human capital as an intangible asset in M&A.
Excerpt from the Book
2.1 Organisational structure
Two key aspects determine the organisational structure of a company. The first one is the way a company is built up. Its organisational structure includes the definition of responsibilities, of hierarchies and relationships between the different departments. The second one is the way how the work and processes within the company are organised. This so called industrial engineering develops and defines the processes of a company, which are influenced by the company’s approach regarding the will of giving responsibility to the staff and the individual role of the employees.
The company’s organisation regarding structural and industrial engineering is very much related to its culture and the development of the organisation of the past. The way an organisational structure looks like is influenced by the culture, the values and the history of the corporate environment.
In modern western companies usually different organisational forms do exist in parallel within one company. Beside the hierarchical line organisational backbone, organisational derivates like staff line organisations, project organisations, team organisations and virtual organisations between different departments or partners exist. This leads to the conclusion that the organisational structure of a company cannot be described with a single concept like matrix organisation or tensor organisation.
Summary of Chapters
1 INTRODUCTION: This chapter outlines the purpose of the assignment, which is to review HRM-related impacts and challenges during the lifecycle of a merger or acquisition.
2 ELEMENTS OF HRM: This core section examines essential organizational components, including structural dynamics, strategic HRM alignment, intercultural integration, motivation, conflict resolution, and human resource accounting.
3 CONCLUSION: This chapter synthesizes the findings, emphasizing that successful mergers require detailed planning, proactive management of "soft" factors like culture, and a holistic approach to employee integration.
Keywords
Mergers and Acquisitions, M&A, Human Resource Management, HRM, Organisational Structure, Strategic HRM, Intercultural Management, Motivation Systems, Conflict Management, Human Resource Accounting, Human Capital, Cultural Integration, Change Management, Intangible Assets.
Frequently Asked Questions
What is the primary focus of this work?
The work focuses on a critical review of human resource management aspects that companies face during the planning and execution of mergers and acquisitions.
Which thematic fields are addressed?
The paper covers organizational structure, HRM strategy, intercultural management, employee motivation, conflict management, and the accounting of human capital.
What is the primary research goal?
The goal is to analyze how mergers impact various HRM dimensions and to provide recommendations for mitigating negative impacts on staff and organizational success.
Which scientific method is applied?
The paper utilizes a qualitative analytical approach, reviewing existing theories and comparing them against practical case study examples of mergers.
What is covered in the main section?
The main section dissects the specific pillars of HRM in M&A, ranging from structural definitions and strategic orientation to the cultural integration of employees.
Which keywords characterize the work?
Key terms include M&A, Strategic HRM, Cultural Integration, Conflict Management, Human Capital, and Change Processes.
How does the author define the relationship between corporate and HRM strategy?
The author argues that HRM strategy is typically a direct derivation from the overarching corporate strategy, necessitating a major shift in HRM during the strategic changes of a merger.
What role does Human Resource Accounting play in M&A?
It acts as a vital tool for assessing and allocating human capital as an intangible asset, which is often a critical factor in determining the value of service-oriented companies during acquisitions.
- Quote paper
- Sven Brueninghaus (Author), Kai Karsten (Author), Bodo Schaefer (Author), 2002, HRM Aspects in the Context of Mergers and Acquisitions (M&A), Munich, GRIN Verlag, https://www.grin.com/document/6418
