Cross Cultural Integration Hr Issues 121

8/3/2019 Cross Cultural Integration Hr Issues 121

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Cross Cultural Integration - HR Issues

During the first quarter of this year, the total value of mergers and acquisitions reached

approximately $900 billion, up 44% from the same period last year. Companies havealways used this strategy to grow and consolidate, and to eliminate competitors.Moreover, one of the main arguments for carrying out these deals has been that theycreate synergies

The first phase of Mergers and Acquisitions there are various aspects of business that isaffected which needs to be streamlined. These processes have a direct relation with thesuccess of the integration. This process such ideally called synergy but it is calledintegration as not all mergers and acquisitions synergies the processes of both the parties.Closer look at the different aspects that can be affected by a cross-cultural integration.

Human Resource: People issues in case of M&A are the most sensitive and critical aspectto handle. Effective communication is the key to keeping the rumors of an effectiveM&A. In todays world there is always a continuous struggle to get the right talent foryour job. Imagine loosing your war just because your warriors have lost path to your goal.

Very little importance is given to human capital concerns at the time of M&A. Followingcan be the reasons:

People issues are not viewed as priority since there are other process driven

challenges to be addressed Top management views people issues too sensitive to address so try not to discuss

the same

Lack of information with the top management

In case of lay-offs dont know how to deal or communicate with the employees.

The value for human capita is marginal for some managers

There are concerns of having their ground stable first then people issues would beaddressed


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The flow of an M&A process:

Before Integration

During Integration

Solidification and Post integration

Step 1

HR issues during integration:

Identifying a pilot who can spread the information. This person should be a verygood communicator, have good analytical abilities, have the good connect with

the staff and should be unbiased

Keep infusing accurate information with the help of that pilot. Constantcommunication to be in touch with your employees

Cultural assessment

Creating practices for learning and knowledge transfer

Step 2

HR issues during combination

During integration of the company there needs to be an extra care to be taken care of:

Deciding on who will be retained and who will be not

Communication here is the most critical. Communication should be handled in themost sensitive manner


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Establishing a HR culture, policies and practices is essential

Systematic approach towards the selection of the team

Integration can be poorly implemented leading to specific implications:

The attrition rate will shoot up

The leadership rate will also go down, as he will have lesser information thecurrent scenario

Employee satisfaction will drop down

Integration efforts differ from company to company so the processes to be put inplace should be in alignment with the new vision and mission

Most of the employees think that the employees care more about financials thanabout their human resources

There needs to be a selection of a integration manager who with the help of the inputsfrom communication manager should implement the integration. The Integration managershould be:

The integration manager should have good HR sense, good analytical skills, goodleadership skills,

Achieved good business sense

Retained a high credibility in the system before

Also the HR is responsible for setting up a Steering committee that will be responsible for

Selection of a leader

Selection of goals and objectives

Role definition, processes and procedures

Redefine or reinforce the company values

Redefine or reinforce the R&D processes

Step 3

Solidification and Post integration:

Clearly there is a new entity that has been created at the outset of the two companies.There are various HR issues that can be addressed at this stage:

A new joint will bring in issues of solidifying, fine tuning, readjusting. The other HRrelated issues:

Creating and evaluating a new structure


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Meddling two cultures need assessment and fine-tuning and change

Help manage the change as a facilitator

Revising the new model

Selection of the new entrants

Deciding the leaders who are going to chalk out the culture of the new entity

Documents

Cross Cultural Integration Hr Issues 121