Organisational Changes Due to Acquisitions

Running head: ORGANISATIONAL CHANGES DUE TO ACQUISITION
Organisational Changes Due to Acquisitions
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ORGANISATIONAL CHANGES DUE TO ACQUISITION
Executive summary:
Acquisitions bring about substantial changes in the financial structures, organisational
leadership strategies and other significant business areas of companies, especially the
acquired companies. However, the changes which are the outcomes of the acquisitions are
not always favourable especially for the employees. The paper would analyse the outcomes
of a certain acquisition of Co A by Co B, both fictitious companies. The paper would analyse
these outcomes on the grounds of theories like strategic fit and the process of acquisition. It
would ultimately end with recommendations for Co B, the company which acquired Co A.

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ORGANISATIONAL CHANGES DUE TO ACQUISITION
Table of Contents
Introduction:...............................................................................................................................4
Analysis:.....................................................................................................................................6
Acquisition process:...................................................................................................................6
Step 1: Target choice:.............................................................................................................6
Step 2: Negotiation:................................................................................................................6
Step 3: Integration:.................................................................................................................6
Step 4: Results:.......................................................................................................................7
360 degree Congruence model:..................................................................................................7
Theory of strategic fit:................................................................................................................9
Theory of organisational fit:.....................................................................................................10
HR operation changes in organisations due to acquisition:.................................................10
Information system changes in organisations post acquisition:...........................................11
Financial structure changes in organisations due to acquisition:.........................................11
Stakeholder theory:..................................................................................................................12
Leadership theories:.................................................................................................................13
Transformational leadership theory:....................................................................................13
Autocratic leadership theory:...............................................................................................14
Conclusion:..............................................................................................................................14
Recommendations:...................................................................................................................15
References:...............................................................................................................................16

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ORGANISATIONAL CHANGES DUE TO ACQUISITION
Introduction:
Acquisitions bring about changes in the organisational attributes of the acquired
companies. These acquisitions create issues pertaining to strategic areas like employees,
information system and financial structure of the acquired companies. The paper would delve
into a case study which mentions about two hypothetical heavy engineering companies, Co A
and Co B where the second acquires the first. The paper analyses the acquisitions and its
impact on the employees of Co A in the aforementioned areas. The first section delves into
the acquisition process which companies follow while acquiring subsidiary companies. The
second section studies the 360 degree congruence model which companies can adopt to bring
about integration within their operations. The next section studies the theory of strategic fit
followed by the theory of organisational fit. These two theories after discussion of their initial
aspects would be explained from the view point of Co A and Co B mentioned in the case
study. The stakeholder theory in the fifth section would point out how the two companies
utilise the theory while conducting business. The fifth section would delve into leadership
theories considering two types of leadership namely, transformational and autocratic
leadership theories. The study would end with recommendations for Co B regarding
application of these theories.
Analysis:
Acquisition process:
The following are the steps of acquisitions which acquiring companies follow: