DeWaal Pharmaceuticals and BioHealth Labs Merger Report

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Business Report
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Executive Summary
A business report is prepared in this study which includes the explanation of management
theories related to the venture of DeWaal pharmaceutical and BioHealth Labs. These two
companies have merger problems which they are trying to solve with the help of management
theories. It also includes the problem of value conflict within the company and analysis of case is
also done.
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Table of Contents
Executive Summary ........................................................................................................................2
A business report is prepared in this study which includes the explanation of management
theories related to the venture of DeWaal pharmaceutical and BioHealth Labs. These two
companies have merger problems which they are trying to solve with the help of management
theories. It also includes the problem of value conflict within the company and analysis of case is
also done..........................................................................................................................................2
Introduction:....................................................................................................................................4
1. What conflicting values are at stake in the case? Identify and explain, using relevant
management theory and concepts. Contextualise your answer with reference to literature on
integration problems in mergers and acquisitions, with specific references to people issues.....5
2. Critique the process that is being applied to work out the details of the integration,
particularly with regard to structure and top management staffing using relevant management
theory and concepts. Ground your answer in evidence regarding people and culture issues in
merger integration studies............................................................................................................6
3. How would you recommend the conflicting values be resolved?...........................................7
4. What process would you recommend that the two senior executives and their HR people
follow to work out the details of integration in regard to the top structure?...............................9
5. Evaluate the usefulness of the management and organisational theories and practices from
the subject that you have applied in analysing the case.............................................................11
Conclusion:................................................................................................................................12
References:....................................................................................................................................13
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Introduction:
A business report is known as the type of assessment in which a company analyses the condition
or situation and analyse the theories of business to develop a variety of suggestions for the
betterment and improvement of the working of the company. Business reports are by the help of
various methods like qualitative and quantitative techniques and methods which can help the
companies to solve the problem because it includes the experiences of others and can lead to the
growth of profit and productivity of the company or organisation. The data which is used in
business report can also be collected by the help of the survey, interview and questioner method.
These methods provide the best and reliable information for companies.
In this study, there is a merger taking place between DeWaal Pharmaceuticals and BioHealth
Labs. But both of them are facing problem in merging with each other because this news was
published in the newspaper and their competitors are very scared of their venture. The first step
in encouraging the venture was to choose the higher level of management for the latest company
who entered into the market. The people who were present on two continents were 120 and there
were about 65 senior position jobs. Both the companies have highly talented and skilled labour
and employees whose performance was very good. Headquarter of DeWaal established in
Netherlands and BioHealth was established in New Your City.
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1. What conflicting values are at stake in the case? Identify and explain, using relevant
management theory and concepts. Contextualise your answer with reference to literature
on integration problems in mergers and acquisitions, with specific references to people
issues.
The conflicting value is known as the distance or problems between the thoughts and values of
two companies or people which are the reason for making them separate. In this study, after two
months the press has been moved to a very new story and the integration of the labour has been
loomed which may not be the really big problem but can be the reason for separating them apart.
Steve the CEO of DeWaal Pharmaceuticals was feeling the pressure to attack the real challenge
or problem of venture or merger. The issues which raised between them was just because they
were not able to understand the problems of each other due to which they weren't be working
together. If they work together, they would have been reduced their rating the outer market
which is not acceptable by both of them. The competition in the pharmaceutical market is very
high and it is very difficult for both of them to keep their venture on the top because there was no
coordination between them which is very important in a venture. There was also higher tier of
the pharmaceutical market which can affect the profit of the company and if they do not give
attention to the problems or issues in the early stage, they would have been decreased their level
in the market and it is highly humiliating (Ou, et. al., 2018).
Management theories mean the concept which is surrounding by the recommendation of the
strategies used in the process of management. The management theories also include tools like
framework and outlines which is used by the latest organisation in solving the problems related
to management and get best results after implementing these theories.
Scientific management theory: this management theory is used by both the companies DeWaal
and BioHealth because this helped them to carry on their business in a very smooth manner and
also used in achieving the targets of their venture. This theory is used by the company because it
tells how to work with another person whose thoughts are similar to the company but do not
know how to coordinate.
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Conflict management theories: Conflict management theory is also used by them because they
know that they are not able to work together smoothly and they are facing so many problems in
coordinating with each other. This makes people who are involved in the venture how to work
together as a team so that they can achieve their desired goals (Wynn, 2016).
2. Critique the process that is being applied to work out the details of the integration,
particularly with regard to structure and top management staffing using relevant
management theory and concepts. Ground your answer in evidence regarding people and
culture issues in merger integration studies.
The process which has been applied in the merger was really helpful for both the companies but
they were not up to the mark which made them work as they want because they raised conflict
between them which is very problematic while completing the work assigned to them. When the
merger was announced between both the companies DeWaal pharmaceutical and BioHealth
Labs, the news was covered by the newspaper and they were very depressed about how to work
because everybody knows about their merger. The venture was just like a reunion of friends in
the college and this news was distributed in the whole world by the newspaper which is not a
good sign for the process of the merger because now most of the companies who feel that they
are their competition will try to break their bond. Both the companies produce and sell a wired
range of medicines and drugs which gives relief to the patients suffering from AIDS (Gary,
2016). There is a different type of distribution channel which is used by the companies in the
country and provide their medicines to all the shops in their country. There was very high level
of discussion which was done by both of them about the place of headquarter and everyone
knows that they are facing coordination issues they came up with the decision that they will have
their headquarter in New York City but the manufacturers who produce their product in Europe
will continue their production and distribution in their country and it is directed by the
Rotterdam. The revenue of both companies after the venture was $8 billion which is the very big
amount and they can keep this record and make it grow if they will coordinate their work and
decrease their number of conflicts between the employees of both the companies and higher-
level management.
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The top management staffing is a very important part of the company because if they do not
work well then there are chances that the level of the company in the market can come down and
this will not be good for them. The structure of the company after venture should be decided by
the company with the help of a discussion between both the member of high-level management
and they should bring upon some conclusion about top management staffing. System
management theory should be used by the companies if they are facing problem in making the
decision about the staff and members. This theory provides different type of techniques and
method which will help in the management and planning of the organisation of the company
(Daddi, et. al., 2018). The merger should use this theory to manage their workplace and
organisation because they are facing a lot of problem in managing themselves and meeting the
goals of the company so that workers or employees can work for the common goal. Employees
play a very important role in the working of the company because they are the one who can take
the level of company higher in the market.
Structuring of the company is a very important part of an organisation and it should be done with
extra care so that it brings out profit from the company. Contingencies are always there in the
company and they should be faced by the company with full attention so that they cannot miss
out anything in between.
The combination of the difference in the culture and unmanaged integration strategy of human
resource plays a common part in the failure of the venture. The talent should be promoted by the
company so that employees put their efforts into the company with full dedication. Employees
should be motivated by the management of the company by the help of techniques of motivation
like promotion, increment and many more which will help the company in bringing out best out
of them. The best approach which should be used by the company is to hire other people to
promote better performance and their appraisal in the company. The company should hire
consultants from the external sources which can help the company in giving important and
valuable expertise for the integration process of human resource. The in-depth and planned
interview should be conducted by the company and collect almost 360 feedbacks from all over
the company which will give them a clear picture about the thoughts of workers and reasons for
issues in the company.
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3. How would you recommend the conflicting values be resolved?
The conflicting value is known as a conflict which is caused by getting the belief of actual
incompatibility with other person or company. Values are the belief that a person who is adding
meaning to their lives. Value of a person shows the good and bad things about that particular
person or company because it is the thing which explains about the person without knowing
(Alvarez, et. al., 2018). The reason behind the conflict is a difference in values of two people or
organisation because if the thought of both the companies and people do not match then they will
not be able to walk together for a longer period of time. A people with different choices can live
together but people with different thoughts cannot live together because thoughts show their
value and they cannot survive with each other in the long run. The other main reason behind the
value conflict is that when people try to put their thoughts and values on other people or claims
for the value system exclusively which do not allow both the parties to diverge their beliefs and
thoughts. So, conflicts should be resolved as soon as possible otherwise it will definitely destroy
the relationship between two companies or people.
 The decision which is taken by both the companies should support their values and
should not offend the value of other partner or the member if two parties want to or
willing to work together. Both the members of the venture should feel satisfied otherwise
they will not be able to achieve the target of the company which is very important for
both the parties to achieve (Saarimaa and Tukiainen, 2015).
 Members of the companies should ignore small mistakes done by the person who is
involved in the venture which will make the partner happy and give them other chance to
understand their values and necessity of working together. Ignorance is the very weapon
in stopping or avoiding the conflict because it does not make the person or member who
has committed fault feel awkward and it is the easiest way to make them realise their
mistakes which shouldn’t be done or committed.
 Another method which can be used to stop the conflict is that if another member has done
something wrong which was not up to the values of other then this mistake should be
addressed to them so that they can understand or realise their mistake. Addressing is also
methods which help companies to solve the value conflict but addresses their mistake in a
very simple way which does not make them feel egoistic and superiority complex.
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 Negotiation is also another method of solving the conflict. In this method employees of
both the companies should be told about the norms and rules and then tell to solve the
problem or issues as a gentleman by understanding the point of view of both the
members. If there is conflict in the values of companies then they should sit together and
talk on the issues they have with the values of other company and then resolve the
problem in a very decent manner.
4. What process would you recommend that the two senior executives and their HR people
follow to work out the details of integration in regard to the top structure?
In order to make the senior executive and human resource that work as per the requirements of
the details of integration then they should follow the communication process which will help
them to increase interaction between the employees and top-level management. The higher
amount of interaction of thoughts will lead to a higher amount of clarity within the organisation
and it will automatically help in achieving the goals and objectives of the organisation (Lohrke,
et. al., 2016).
 Encoding: Encoding is the process which is very important in the communication
process because it moulds the message into codes and then sends message to the receiver.
So, the company should use this method of moulding the process into codes and then
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Encoding
Message
ChannelReceiver
Sender
Feedback

send to the receiver which will give privacy to the messages and help increase the
interaction between the employees. The communication process is recommended to the
venture of both the companies because it is very important for them to keep their private
matter secret otherwise it can be leaked on the internet or media which can be very
problematic for the members of the company (Chang, et. al., 2018).
 Message: Message is another step of the communication process in which it will include
the real part of the communication or on the topic this process has been performed. This
is the main part of the whole process because if there is no message to send or receive
then there will be no interaction between the two people or company. The messages
which are sending by both the companies to each other for better working should be good
and professional so that no one can get offended by the messages and everyone can feel
better in interacting with each other. A message should be specific and to the point so that
the communication process can become easy to understand and positive in nature (Hirota
and Yunoue, 2017).
 Channel: The channel of communication which is used in the company should be formal
and in written form so that no one can deny their words which are said by words because
this type of cases has been seen lot many times that selection of wrong communication
channel will lead to the loss for the company or fraud by the member of the company. So,
the venture should choose the right channel for communication so that they can avoid
these types of mistakes.
 Receiver: The process of receiving the message should also be taken control by the
company. The method of receiving the message should be good and safe so that only that
person can see the message for that message was created, so the venture of both the
companies should take care of this part also.
 Sender: The venture should be very careful while sending the message to another person
or employee because it may affect the communication process of the company straight
away and can lead to the loss of the company.
 Feedback: It is the last step of the communication process because in this step there will
only be the discussion on the validity of the content. The feedback has been taken from
the receiver whether they liked the message or not or the message was useful to them or
not. The merger should take care of feedbacks and must revert on them properly.
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Whether the feedback was of the customer or employee both are important for them
(Lakshmi, 2017).
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