Analyzing the Merger of DeWaal Pharmaceuticals and BioHealth Labs

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Case Analysis Business Report
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Contents
Executive summary.....................................................................................................................................3
Introduction.................................................................................................................................................4
Conflicts Values..........................................................................................................................................5
Critique the process.....................................................................................................................................6
Solutions for the conflicting Values............................................................................................................7
Process for top structure..............................................................................................................................9
Importance of the management and organizational Theories and Practices...............................................10
Conclusion.................................................................................................................................................11
References.................................................................................................................................................12
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Executive summary
The produced report will explain the challenges which an organization faces at the time of the
merging process. It’s not accessible for the employees of an organization to follow the other
organization quickly because they have spent most of their time with the recent organization and
any type of difficulties they would face when they enter in a new organization. The above report
is making a reflection on various type of management and organizational theories and how they
affect the environment of an organization, it would be described in the below report. It is also a
report about how employees face difficulties at the time of merging with another organization.
In the given report the various types of conflicts would be described and solutions of these
conflicts also described. The report describing the difficulties of merging process and there are
various theories which would be applied in the given context. The positive effects of these
management and organizational theories also would be explained in the report. The management
team needed a top structure of management to apply these organizational theories and the
planning of related organization to implement these theories in an organization would be
illustrated.
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Introduction
In the delivered scenario there is a situation where DeWaal Pharmaceuticals and BioHealth labs
are merging together and the workers of both organizations are confused about working in a
different organization. DeWaal is a drug maker organization based in the Netherlands and
headquarter of BioHealth is in New York City and the organization currently became a
competitive organization to the other drug marketer companies.
In the below report the merger process of both the organization will be described and the sources
which are necessary for this process also would be described. The company is selecting the top
management authority for the merger process and there will be some theories which the
management team will apply in their merger process. A merger is a common process and it
depends upon the adaptation quality of an organization. In the merging process, an organization
makes efforts for growing their shares of the market, to investigate the new marketplace and to
increase their aggressive advantages. The report will describe the merging process of Dewaal
pharmaceuticals and BioHealth labs and would make a reflection of related theories which would
be applied by the top management of the organization.
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Conflicts Values
The basic conflict which an organization faces while merging with the other organization is
adopting the new working culture and the same situation is facing by DeWaal pharmaceuticals
and BioHealth labs. There is a difference between the cultural quality of both the organization
and it is hard for workers to include a new working culture of a different organization. Both
organizations’ workers are using too of a particular environment and the team culture of both
organizations are different so, it would be not easy for them to manage easily with a different
organizational culture.
According to (Saha, et.al)The another conflict which they could face is receiving the dishonesty
in the relationships and as both organizations are merging with each other it becomes more easy
to face a situation like this. The different leader of the organization would lead a different team
and it is becoming difficult for both the organization that which employee thinks positive or
negative for a particular candidate. It would be not easy for them to create the honesty level with
the leaders of that organization.
One more conflict could be faced by these two organization and that is ignoring incorporation it
means there is a lack of planning and process during the merging process. The workers of that
organization may face some difficulties without having some guidelines about the new culture
and management system of a particular company and in the merging process of DeWaal
pharmaceuticals and BioHealth labs, there must be some strong guidelines for the employees
who are going to face a new working culture in that organization.
The Accretion Dilution analysis of merger and acquisition involves a straightforward test which
explains the effects of this process to analyzing the earning per share value of that company. This
theory or merger and acquisition help to understand the circumstances of a merger. In this
process, the accretion process is referred to as the situation where per share earnings is bigger
than a buyer’s earning per share before making the deal. The other factor Dilution refers to a
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situation the post-deal earning per share is lower than the earning per share of the acquiring
organization before making the deal.
The breakeven analysis is included and it is pretty self-explained process on the merger and
acquisition and the company which is going to buy would fundamentally breakeven. The
earnings per share of buyer and earnings per share of the company would be in the same
situation before and after making the deal (Goldman, et. al.,2014).
Critique the process
The staffing method which is using by Lindell and Kaspar Van de Velde is not as much power
for the organization and they need to create a strategy about hiring the top administrators for the
company. They need to establish standards for hiring the senior executives for the organization.
With a general conversation, Kaspar decided to select leaders of international marketing, Europe
operation, and human resource. Steve decided to select the leaders of research and development,
finance and the leader who can tackle all operations of the company. The top management
executive would be selected by Steve and Kaspar’s satisfaction. The process could become
unproductive because Steve is unwilling to accept some choices which are made by Kaspar like
some of the candidates were left from the organization. Steve and Kasper need to take help from
any consultancy service to avoid these types of difficulties. The consultancy organization may
help them on a better level of the hiring process. The hiring process of an organization explains
about the candidates that they were hired for an organization and in the reference of this case the
selected organization can decide the suitable and best candidates for their organization.
The construction of an organization which used for running any other organization is not
suitable. Steve Lindell is Chief executive officer and Kaspar Van de Velde is the chairman. The
senior executive of the company is Steve and the leadership abilities which Kasper is having are
making him the expert of leadership. The various qualities of leading an organization could be
performed by a leader and in the case of this company both senior executives Steve and Kaspar
does not acquire any logical sequence of authority because the senior executive is Kasper and the
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final decisions are taking by Kasper. It is making it difficult for them as the shareholders of an
organization are affected by this and already the prices of shares reduce 20%. Furthermore, the
employees bothered about this situation and some of them left the BioHealth lab. As per the last
media report, that was a lack of leadership which influenced the future revenue of the
organization. For making a successful merger process Steve needs to match his skills with
Kasper's policies which would be made for a better merging process.
One more difficulty which was distinguished, that the decision-making techniques are working
slow in the organization. It is necessary for an organization to manage all the related process like
hiring and training could be in a better position but in the case of this organization, this process is
not maintained well by Steve and Kasper. They are not able to take necessary decisions on the
right time and because of this most of the employees are leaving the organization. The
organization needed the top executive management on a primary basis and they have already lost
one of their senior executive and others are ready to leave the organization. It clarifies that these
two top executives not chosen the proper management planning system for their merging process
which is making difficulties to manage the organizational culture and process. It would be more
effective if Steve managed the recruitment process appropriately and the method of data analysis
should be needed to use by them.
Solutions for the conflicting Values
After the merging process, it becomes essential for an organization to generate a better top
management authority for making some effective rules and regulations compared to the success
of an organization. The role of top management authority is important for making an adequate
decision-making process for the organization. It also creates some guidelines for the manager
how they need to treat the workers and this culture affects the success of an organization. The top
management authority of this company needs to make an effective decision-making process and
better ways to talk with each other for a successful working environment. They need to provide
value for their employees so they can think about boosting their performances and the decision
of leaving the job will be removing from their minds.
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According to (Neely and Mosley, 2018).Effective leadership is important for them to manage
their team in a better way. Moreover, involving the new leadership qualities may work for them
to creating the new and effective working culture for employees and it will increase the value of
this organization. A high percentage of employees think that in the process after merger and
acquisition the role of top management authority in the change process is important on a broad
level. When an organization has its senior management authority it develops commitments that
make efficient post-merger process.
The senior executives Steve and Kasper need to build an effective leadership policy for the
people who are working and the leader of that team need to try to motivate the team members in
a better way. The leader should try to take better initiate actions to motivate the whole team and
it is also necessary for providing them guidance related to the work. The leader of the team needs
to boost the team members and try to build confidence in them. A better team leader creates a
great working culture for the employees and the top management of this company needs to
manage the working and coordination process properly because it will show that they are able to
achieve their goals or not (Landis, et. al., 2014).
The senior authority needs to select a better management style for the organization because it
will provide a positive impact on the post-merger process. In the scenario, the two organization
are merging with each other and the employees of both the organization are feeling a situation of
nervousness. Because of this fear, many of the employees left their jobs but Steve needs to
remove this situation from the organization and should try to include new employees for the
organization. For doing this, Steve can take help from the consultancy services to hire new
employees in their organization and to make the working process continues. Steve also need to
understand why employees are dropping their job and should try to discuss this issue with the top
management authority. Steve needs to remove the difficulties which the employees are facing by
using different approaches.
Both senior executives need to identify the causes of cultural differences in the organization and
try to diminish them properly. Steve needs to recognize the values which would be beneficial for
them and after recognize them Steve need to make efforts towards including them in the culture
of the organization. The higher management needs to use the seven-step process which would be
important to lead an organization in an excellent way. The first step involves the recognition of
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values which could be beneficial for them, the second step explains that the management should
try to communicate about these values with the employees, the third one includes some activities
which must be related to the leadership process. The fourth step explains that the celebrations of
small victories are needed in an organization, the fifth step illustrates the measurement factors of
success, the sixth one says that communication must be included in the change process to remove
the confusions and the last seventh step includes the cultural change policies to manage the
leadership in an effective way (AKPINAR, 2016).
Process for top structure
It is not simple for them to select the excellent top management executives and from the
assessment describes below it is clear that the new organization need to include better top
management services in their organizational culture. The hiring of mixing manager is necessary
for the organization on a fundamental basis. For hiring the top authorities the senior executives
Steve and Kasper should try to take help by the consultancy firms because they could provide
them better and suitable options for the higher management.
By taking the help of a consultancy firm Steve and Kasper would be able to manage their time
and they could focus on the other necessary activities which are related to the firm’s increment.
The manager of the organization would create effective leadership strategies for the employees
to get the target which they decided. The manager should try to create strong bonds between all
the employees and it is required for a leader to understand about the working culture of both the
organization before starting the mixing process (Dugguh, et. al., 2014).
Another recompilation is to choose a team which could be able to adopt the mixing process. The
leader of a particular team should try to select those people in their team who are willing to
achieve their targets and want to work hard towards the organization. An excellent team creates
effective decision-making strategy and its accomplishment. The third stage of this process
describes creating a valuable working structure for the team to making the process well-
organized. After the process of merger and acquisition, an organization needs to design a
management structure to keep away the organization from any insecurity. The data analysis
method could be used by the related firm to measure the plants which they want to shut and run
(Liu, et. al., 2015).
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The fourth stage of management structure includes the top performing employees in it. Leaders
of an organization need to select more employees to get their goals easily. The leader should try
to include more people because by adding those in the team fear of losing employees could be
reduced by Steve and Kasper. The employees would be connected with the organization if a
leader supports them in every difficult situation.
Importance of the management and organizational Theories and Practices
The leadership style which was adopted by Steve and Kasper is Situational leadership.
Situational leadership explains the relation between task and relationships. The style of
situational leadership adopted by Steve and Kasper was task oriented. In the process of
situational leadership, a leader can change the leadership style and adopt the other according to
the need of organization (Al Shaar, 2015).
Democratic leadership could be helpful for this organization because it explains that a candidate
can take a part in the decision-making process and Steve and Kasper applied this method in the
organization. The demographic leadership targets to manage the equality between the group
members and group members have the right to discuss their innovative ideas which may be
beneficial for the decision making the process. By the help of this theory, group members could
feel more engaged with the organization and process and their imaginations must be awarded by
the high authority of the organization. Steve and Kasper need to take opinions from the
employees and try to use their suggestions to get a benefit.
Another Theory which was implemented by Steve and Kasper is Henri Fayol’s Chain of
command and both the senior executives were tried to maintain a fixed structure for the
particular targets. The theory explains about a well-organized structure for achieving the
organizational goals. Steve is the senior executive of this company and the decisions taken by
him would be appreciated. The theory of chain of command could be advantageous for them to
avoid the conflicts from their organization (Huang, 2015).
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Conclusion
From the above report, the process of Merging and acquisition could be appreciated. Both
organizations DeWaal Pharmaceuticals and BioHealth are merging collectively and there is a
need for creating a well-organized working culture for the employees who are shifting from
another company. The senior executives Steve and Kasper are proposed to manage a better
organizational culture and for this, they implemented various type of theories and models in their
organization. It is defined in the above report that the working culture of DeWaal
Pharmaceuticals and BioHealth are not comparable and for making it convenient for workers the
senior management of a company is attempting to execute new strategies and planning. There are
some issues faced by the senior management but they could be removed by the organization with
the cooperation of different theories of leadership and management.
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References
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