The Acquisition and the Role of Human Resources - Assignment Example

The Acquisition and the Role of Human Resources Answer The Scorecard Inc. is one of the good manufacturing companies who are engaged in manufacturing of sports equipment. Earlier they had been successful in their business due to their level of quality and service of delivery. But the problem occurred when they tried to acquire Partners Manufacturing. Peter Wolfe is the CEO of the company and a major stockholder. For the acquisition to happen he formed an acquisition team which included Dave Willow who is a consultant, Richard Pierce who is the General Counsellor, and Peter himself. He left other executives and it didn’t keep them in the loop on the matter. This made other executives angry as to the modalities of the acquisition was not shared with them. Several questions were asked about the correctness of the acquisition strategy. Alan who had a fantastic working relationship with Peter was also not informed well about the acquisition. He was repeatedly told that this topic is not to be discussed among them and it is off the table. Peter didn’t trust their other executives and forgot that he should have adopted a leadership style where everyone’s ideas are put in place (Douglas 31-32). No one from the bottom line of workers was included and even when asked specifically about the company, Peter was visibly upset and without answering they left. This shows that he wanted to do the acquisition all by himself. This resulted in high turnover rate of the employees since it didn’t have a clearly defined goal and direction after the acquisition. Answer 2 Peter has included only three members as part of the acquisition team. He left out the other top executives from being part of the team. Hence the top management were visibly upset. Even Alan who was his best partner and shared so many successes was not kept updated with the acquisition story. There were times when Alan asked about the potential company, but Peter was surprised at how they knew the information which was supposed to be kept a secret. Peter became frustrated and replied that the discussion was off the table. He also tried to contact Peter in email but the answer was same. Several other employees began to ask the managers about the acquisition strategy but no one knew specifically to answer their queries. At a special executive meeting, Peter told others about the company name but directed them not to throw any suggestion at them (Geber 28-37). Many questions were thrown at them, but no proper answer to their questions was given. This made the executives irritated. They were wondered what was the product lien, marketing sales force, territories of the acquiring company. This made the top executives angry at the leadership style of Peter. Answer 3 Scorecard Inc. faced many Human Resource issue in course of Acquisition of Partners Manufacturing. After the Acquisition of the company, there was high rate of turnover. At first it was imperative on the management to formulate a HR policy which would be in line with the operations of Scorecard. All the employees should be given the same benefit so that they don’t feel any partiality is been done with them. The HR manager should compensate them following a proper method (Lubatkin 295-302). There shouldn’t be any inconsistencies in the decision making process which might lead to frustration. The employees should be properly given work on the basis of their competency level. At all levels of operations be it manufacturing or other, it was imperative to keep the keep the employees motivated so that the customer loyalty doesn’t get affected. It was necessary to talk with the employees as to why they were leaving. Performance evaluations needed to be one thoroughly at all levels. Answer 4 Peter Wolfe, CEO of Scorecard was initially very effective which made the company grew at 5% per annum. But he was hesitant at first to acquire any company. But due to pressure from management, he finally agreed on going for acquisition of a company. He formed a group of three executives including him and left the other executives from the loop. He maintained that no one should know anything about it. He thought that they were competent enough to handle all the formalities and didn’t want to bother others in it. Basically he is a conservative CEO who does not wish to share all with the employees and let he handle all the things alone. His strategy is not to let everyone get involved in this deal and let the top management handle things on their own. He thinks that the bottom level employees do not know much about the modalities of acquisition. Answer 5 Due diligence process is a mandatory exercise of investigation or verification that every company undertakes become getting into any deal with another party. A due diligence report is generally given out on a company when a deal of merger or acquisition or any strategic alliance or any business related deal like the purchase of equity ownership in the company takes place. Scorecard is a medium sized company and was in the verge of getting involved in a merger deal. There are certain areas relating to the Human Resources Management in the company where there is requirement of thorough due diligence report that would ensure the credibility of the company to the other entity that is getting involved in a merger with the company. It is important to understand in the due diligence process regarding the business model in which the company operates. The analysis of the business model would help both the parties to understand how the merged entity would operate and what kind of hierarchical levels would be existent in the newly formed organisation. There is also a necessity to understand the industry in which the two companies operate and who the competitors are (Bratton and Gold 217-243). The talent acquisition team has to be careful about retaining the right talents and the risks of losing the existing talents in the event of the merger. There should also be proper representation from all the levels of hierarchy in the due diligence process. The people involved in the process have to be objective as well as very detailed in the process to ensure that there is right representation of the situation in the company. Answer 6 It is inevitable that the executive team of Scorecard Inc. have learned from the experiences of failure in the merger process. The executives would be able to find out the loopholes of the process. This would actually provide a direction to the company for the ways in which the Human Resources process of the company could be modified for the betterment of the company. There was a requirement for the involvement of the management into the process. The confusion regarding the differences in the area of the operations of the merged company could not be solved. The executives should learn from this that the synergy should be uniformly spread across the entire organisation and proper orientation programmes should be conducted in order to blend executives from both organisations into one singular company with a sole mission and vision. Dave should also not concentrate on money making but need to consider the proper human resource management in the organisation also one of the main objectives. There should also be uniform policy for employees of both the organisation in the merged entity. There should not be discrimination. The executives have to change their mindsets of Scorecard and have to consider themselves as the employee of the new organisation. There should also be more consistency in the decision making process of the top executives. Works cited Bratton, John and Jeffrey Gold. Human Resource Management, Theory & Practice. London: Palgrave. 2007. Print. Douglas, J. Preparing for your next acquisition. CA Magazine, 132(6): 31-32. 1999. Print Geber, B. The forgotten factor in merger mania. Training, 24(2): 28-37. 1987. Print Lubatkin, M. Value-creating mergers: Fact or folklore? Academy of Management Executive, 4(1): 295-302. 1988. Print Read More