Mergers: Issues, Conflicts, and Recommendations

Running head: MERGERS 1
Mergers
Student’s Name
Institution Affiliation
Date

MERGERS 2
Introduction
Merging has become an essential concept for businesses wishing to expand and dominate
global markets. Companies that have similar activities have a more straightforward integration
process compared to those that have different activities (Light, 2001). However, the process of
merging is not without a fault as issues are ranging from cultural disparities to prioritizing on
what projects are viable for mergers. De Waal, a pharmaceutical company from Netherlands and
BioHealth a pharmaceutical giant that has its headquarters in New York are considering merging
so that they can enjoy substantial economies of scale associated with increased business
operations. Such merging will also ensure that both companies utilize and benefit from the
services of talented individuals from both sides. The news has the pictures of Steve the CEO of
BioHealth and Kaspar, the chairman of DeWaal smiling at each other as they shake hands
signaling a good relationship in the days to come for the new company under their leadership.
However, there are emerging issues that suffice as demonstrated by Alison, a director of
sales and marketing. Alison expresses her fears of how some employees are considering job
offers from other companies out of fear that they may not be offered the positions they held
before the firms decided to merge. Alison was also frustrated that they had lost five of their good
employees leave the company due to lack of proper communication by management. Alison
urges Steve Lindell to take charge and talk to the employees regarding their fate before it was too
late.
Conflicting issues at stake
Steve seems to have forgotten the basics of reassuring people who are considered as
assets to the company, people like Alison who are essential and needed by the new company.
The management through the selection team should have approached such people and explain

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their projections in maybe one to five years. They should assure people of future opportunities in
the company if they decide to stick around and wait for the perfect moment. Steve ought to have
approached Sandy Allen and use every possible wit available to make her remain. He should
have assured Sandy that the company depends and needs her services and that one day she will
succeed him as the next CEO. Such comfort would have given her morale to remain and work
for the merged firms.
Considering the unfolding of events, it is evident that Steve is using a softball in a game
requiring hardball. Steve seems to underestimate the fact that the prosperity of mergers begins
with an understanding of power dimensions that is who has such power and how that power is
being used. (Gatti & Chiarella, 2013) It is the responsibility of Steve to push Kaspar to speed up
the integration process. Steve has been with Kaspar long enough to understand that DeWaal
leader’s behavior during the lunch meeting was his character. Trying to fathom Kaspar’s
behavior would only make BioHealth’s CEO more tentative. He has to bring an end to the
noodling by his counterpart and inform him that it is time to make decisions. Making decisions
even the ones that make one regret is recommended than doing nothing.
When merging companies, speed is critical in such a process. It is important for Steve to
assemble all the top people that they have selected and made them the core of the selection team.
Involving Christian and Bruce in the process appears risky as they have significant limitations.
For instance, Christian is not independent and authentic when it comes to making decisions. He
depends on a computer to do the task for him (Light, 2001). On the other hand, Bruce though he
seems to have good instincts and not being afraid to speak his mind to Steve, behaves like a
clown.

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Thus, before the meeting of the selection team, it would be wise for both Steve and Kaspar to
call Christian and inform him that being a decision-making day, there was no time for testing and
examining feelings and should Christian follow that path then he will not be allowed to attend
the meeting. On the other hand, if Steve aspires to have Bruce participate in the meeting, he
should advance the same conversation and tell Bruce to stop acting like a clown.
It is at these strategic meeting that Steve should outline the selection criteria to assist in
driving in success for the new company, decision making, and skills necessary for
communication and relationship building for the merged companies (Faulkner, Teerikangas, &
Joseph, 2012). When merging process is taking place, it is not the time to select people who take
a week to get things done or who prefer having their lunches sipped under the office door for
them. This should be the perfect moment for the team to debate the selection criteria to be used
and select a pool of many individuals as possible (Nogeste, 2010). An order should be given that
no one leaves the room until a decision is reached. This should encompass having a backup plan
for individuals who turn down job offers extended to them. Also, there should be alternative job
opportunities for those who have to be excluded from the 65 percentiles yet needed by the
company. A notification should follow, and people should be given an ultimatum of a day to
decide and consider their choices.
Recommendation for both Steve and Kaspar
Steve with his counterpart believes that they are choosing key people and that their
strategy is the best. However, they are wrong in three different ways. On first account, the two
executives have different views about the urgency in selecting the company’s top management
team. Kaspar is unconcerned about moving things fast, and Steve on the other seems right to be
worried about the slow pace. The stability of the senior team is necessary as one of the short-