Navigating Challenges in International Mergers and Acquisitions

In international mergers and acquisitions, HR managers confront numerous challenges, notably cultural differences, compensation strategy alignment, and performance management adaptation. This report delves into the complexities arising when businesses from different countries merge, highlighting the anticipated conflicts in work culture, employee environment, and motivational strategies. By examining the merger between cable & Case and Galaxia Emporia, it underscores the importance of effective HR actions to harmonize international compensation structures and enhance performance across merged entities. The findings suggest that preemptive planning and adaptive measures are crucial for mitigating integration issues and achieving seamless organizational synergy.

Case Study Analysis

Table of Contents
Introduction.................................................................................................................................................3
1. Issues of HT in international merger and acquisition...........................................................................3
2. Complication of Human Resource in context of Compensation..........................................................5
3. Performance management..................................................................................................................7
Conclusion...................................................................................................................................................9
References...................................................................................................................................................9

Introduction
In the international environment, the HRM concepts are applicable to address the issues related
to the cultural and social differences. In the international business merger HR professionals need
to make strategies and conduct proper research in context of economic, cultural and legal
differences between countries. The present sections give an overview of the different issues and
obligation which are applied in case of international business. The host country should be in
constant communication with the home country office should ensure policies and practices are
aligned with the organization (Lebedev, Peng, Xie and Stevens, 2015). The present report is based
on No-cable & Case mobile shops and its acquisition process.
1. Issues of HR in international merger and acquisition
No-cable & case is Singapore based enterprise which sells phones, tablets, and repair phones. It
has 41 chain stores in Singapore and Malaysia. The corporation wants to expand its business on
an international level. The owner of the company Jo and Alicia Leung want to purchase Australia
based Galaxia Emporia (Cooper, Liu, and Tarba, 2014) which is an online retail chain and it has 25
stores in Australia. Through this merger, No-cable & case receives distribution network in the
Asia-specific and also expand business in Australia. In the international business merger, HR
issues have to face many types of problems. Some of them are given below:
Analysis theory
In the merger and acquisition, there are three-stages model which can be used for identify the HR
issues and provide formalize the M&A process. The ability to structure of three stage model in
the organization allows others to focuses on necessary conditions for successful M&As. The

three-stage model is taking over by the companies so they can integrate with merger easily and
achieved business-related goals earlier. The $13.2 billion acquisition of Columbia Pipeline Group by
TransCanada is also followed the similar concepts in order to overcome with HR issues related to the
merger and acquisitions.
Change Management
The first issue associated with the merger is change management. As after the acquisition of the
new business the company has to make many changes in its business policies. The new
management can make changes in the top authority and also change in the procedures. It is
possible that the employees and other individuals resist the changes implemented by the
organization. The employee resistance is the most common problem in the change introduced in
an organization. The business organizations face this issue as the employees find difficulty in
adapting to changes in a business organization. They find it challenging to adapt to new business
processes or learn new skills; as a result, the employee resistance is the most common problem in
the business organization. It directly impacts on the productivity and the profitability of the
business organizations.
In the case of No-cable & Case mobile company, HR may also face similar problems as the
employees of Galaxia Emporia can become change resistant and do not accept new policies
(Krug, J Wright, and Kroll, 2014). So new management Jo and Alicia Leung need to make
communication with workers regarding the vision and purpose of the merger. The HR should
make communication about the necessity of changes.
Integration of Culture

In the international merger and integration of the two companies, culture also needs to be
integrated. In the merger of No-cable & Case and Galaxia Emporia, the culture of both
companies is also integrated with each other. The No-cable & Case is making the focus on retail
business; on the other hand, Galaxia Emporia is focused on the online business in retail. In both
companies, employees have different culture and values. In the international merger, it may be
possible that cultural conflicts are occurring. So, the HR needs to anticipate culture differences
and take steps to integrate two cultures.
Workforce Planning
In the international merger and acquisition, the new management needs to decide their structure
and determines who will stay and who leaves the organization. It can lead to dissatisfaction
among present employees. The company may fail to retain its key personnel or talented
candidates. So, in the acquisition Galaxia Emporia, the new management needs to ensure
effective workforce planning and maintained its key talent employees (Deng and Yang, 2015). In
addition, the company also ensures to make effective communication with laborers and help to
increase understanding requirements and needs of the new business.
HR Policies, Compensation, and Practices
Mergers & Acquisitions can also lead to layoffs of the employees in the business. In the merger
and acquisition, outsourcing process may be creating issues problems and results in too many
issues for HR. In the merger and acquisition of No-cable & Case and Galaxia Emporia, HR
policies and procedures need to consider all types of compensation for all the employees; in
addition, the business needs to follow all types of international labor laws and their implications.
Forming the Merger and Acquisition Teams and Leader

During the merger process, there are different types of changes which appears so management
needs to build a team for M&A, through which they can effectively apply changes and also help
the company to overcome with merger issues. In the acquisition of Galaxia Emporia, Jo and
Alicia Leung need to ensure to make the leader focus on the merger solely rather than focusing
on the business operation (Marks and Mirvis, 2015). It helps the HR and other management to
effectively executive their policies and procedures. The new management can also conduct
meetings of employees and leaders so they can develop a better understanding.
2. Complication of Human Resource in context of Compensation
In the global business, there are different types of implications which apply on compensation
policies of a business organization. It is important to focus on the design and the development of
the compensation policies of an organization. It is also important to ensure that every employee
is given compensation according to his capabilities and skills. It must be attractive and must be
capable of attracting the employees. In the international business, the management of company
needs to make sure to follows all type of the national, host country and third county rules and
regulations.
Analysis theory
There are different types of the compensation theories are adopted by organization. As per given
case study the No-cables, and Case company is adopt equity theory. As per this theory, No-cable
and Case Company adopt Equity theory of compensation. According to this theory, the company
has to pay equally to all employees as per their skills and knowledge. The similar theory is also
adopting many business organizations such as Apple and Google Company.

Maintain the worldwide pay scales and policies
In the compensation of employees, the management needs to consider equal pay for all the
employees and workers. In the case of a home country, employees are paid according to their
requirements and needs. The similar approach is also applied to the host country and third
country employees. It helps the company to maintain equality in the business. It is a legal
obligation of the international business on HR managers (Gomes, Angwin, Weber and Yedidia
Tarba, 2013). In the acquisition of Galaxia Emporia, the manager also needs to pay equal payment
according to employees’ needs and requirements. This is called balance sheet approach.
Legally Mandated Amount of Vacation of Days
All the country have the different legal amount of days which must be mandated as holidays.
Most of the countries agree that the employees must be given one off in a week and most
probably Monday. Other than that, other day are also mandated as holidays which include public
festivals or offs. For example, in Australia, there are maximum 20 days, one can request about
the vacation. In the USA, a person can apply for maximum fifteen days’ vacation. So, the HR
managers need to maintain and pay the amount of compensation to all employees according to
their legal structure. In the case of a merger in Australia, No-cables, and Case need to give
compensation of 20 days’ vacation. In Singapore, a person can take vacation of15 days.
Payment of Cost of Benefits
Many countries in the world offer the health-care facilities universally. The HR managers need
to consider all types of health-related facilities obligations and cover all taxes. In the acquisition
of Galaxia Emporia, the company and HR managers have to pay another cost of benefits to their
employees (Ellis, Lamont, Reus and Faifman, 2015). If employees belong to the third country such

as Malaysia, then payment would be payable according to the Employees health Act. In
Australia, health payment would be payable according to the Health and Safety Act 2012, in
which all employees have to right receive insurances and in Singapore, all residents receive a
catastrophic policy from the government, but they need to purchase additional insurance for
routine care.
Pay System and Legal Requirement
The pay system includes basic payment and the hourly payment to workers. In each country,
there are different laws and regulations related to the payment system and legal requirement. It
becomes an obligation for HR and source manager to make payment according to the law. Such
as in the Asian countries, the payment system would be based on making higher payment on the
basis of seniority (Bauer, Matzler and Wolf, 2016). In the same case, in Australia, payments include
minimum wages per hour and in Singapore, in the case of a merger, the new owner Jo and Alicia
Leung need to make sure to fulfill all types of the basic payments and to fulfill the legal
requirement for acquisition.
Other Compensation
In the compensation of the international merger, the HR manager needs to make arrangements
for estimating correct analysis of all expenses of the company. The HR professional would
estimate these expenses in the home country and costs for the same items in the host country. For
example, if No-cable and Case Company is paying $100 to employees as expenses then in
Australia and other countries they have to make similar payment. If any type of difference
appears in the expenses amount then the manager should make compensation. During the
merger, many employees have to face layoffs so the business should also pay extra compensation

to employees according to the law. Other than that, the salaries of the employees also need to be
streamlined according to between different organizations. The employees at the same post at
different organizations must be given same salaries so that no dissatisfaction occurs between
different organizations.
3. Performance Management
The main challenge in the overseas merger is performance evaluation. In the performance
evaluation, the domestic country should rate the performance of the expatriate. In case of host
country employees and management may evaluate the performance of the employees; however,
the cultural difference makes the process ineffective. In the case of Malaysia, harmony in most
important as compared to productivity (Lebedev, Peng, Xie and Stevens, 2015). So, the merger of
new business Jo and Alicia Leung need to make sure to maintain harmony in the workplace. On
the other hand, in Australia, performance evaluation must be on basis of the productivity
generated by employees and number of customers should be added in business.
The theory which adopt by the company is Goal setting theory. As per suggestion of this theory
individuals goals are established by the employers. By motivating employees for improving
performance, company can enhance worker’s performances effectively.
In the acquisition, management needs to make sure to use balance set of rater so they can
maintain performance effectively in the home country and the host country. Apart from
evaluation, performance management also needs to make criteria for evaluating the performance
of the individual. The marking criteria should clearly communicate to all employees and also the
business should make sure that the performance management should be developed as part of the
individual development and as an effective organization tool (Lebedev, Peng, Xie and Stevens,

2015). The performance management should also need to obtain feedback from employees to
improve performance in the company (Cooper, Liu, and Tarba, 2014). In case of merger and
acquisition, management and other individuals need to make sure that performance management
should be based on the role of leadership, effective communication and address cultural
differences between different people. No matter what strategy is adopted by Jo and Alicia Leung
for improving enactment, they need to make leadership more effective. There is no such legal
obligation for performance management but the culture and workplace ethics make huge
differences
In Singapore and Malaysia, people like to work with harmony and easily adopt the cultural
difference, while in the Australia individual are making the focus on an increase in sales and
profit. On the basis of the individual actions, performance is evaluated (Cooper, Liu, and Tarba,
2014).
Another obligation which rose for a manager under the performance management is to provide
training and development. Through the training and development, the employees can improve
their performance and also fulfill gap of cultural differences. In the given case study, No-cable &
Case and Galaxia Emporia have different work culture and purpose of working. No-cable &
Case is mobile shops and repair company which mainly offers its services through the physical
store while in case of Galaxia Emporia, the company mainly deal in the online business (Krug,
Wright and Kroll, 2014). So, both the organizations have different working culture and also they
have a different business purpose. In case if the team members of No-cable & Case leave for an
international assignment, HR manager needs to provide training to employees so, they can make
effective interaction to each other.

In addition, in the implementation of performance management, organizations should also
provide reward and motivation. In each country, HR management has a different reward system.
In the Singapore and Malaysia, the management uses non-financial reward and motivation
techniques such as providing “employees of month” or giving promotion (Deng and Yang, 2015).
On the other hand, in Australia, management have to use the financial techniques such as
providing extra salary. In the host country, home country and third country all method for
evaluating performance can be evaluated. So, the management has set different criteria in each
case. In addition, the new management also set all performance rate criteria ahead on time and
provide a clear picture of the international merger. On a timely basis, they also should collect
feedback from employees so they can make further improvements in performance management.
Conclusion
Summing up the present report, it can be concluded that, in the international merger and
acquisition, HR manager had to face many types of issues. When two business organizations are
merged with each other there are a lot of differences which appear in the culture, work
environment and conflicts among employees. These all issues are anticipated so HR manager
needs to take effective steps to overcome these issues. As present in above case, the management
of cable & Case and Galaxia Emporia are merging. Both organizations, in the case of HR should
take effective actions to follow international compensation and improve performance.

References
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