WHO GOES, WHO STAYS???

Indian Institute of Management Raipur

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By Aditya Polisetty (12PGP006) BJVSP Varun (12PGP012) Harshvardhan (12PGP017) Venugopal Vellanki(12PGP049) Umang Agarwal (12PGP111)

Indian Institute of Management Raipur

SUMMARY / FACTS
2

Facts

Issues

Possible Actions

Strength Weakness

Solution

Merger between DeWaal Pharmaceutical (Netherlands) and BioHealth Labs (USA)  BioHealth Labs

Indian Institute of Management Raipur

Steve Lindell – CEO  Bruce Bollinger – HR Head  Alison Whitney – Director, Sales and Marketing
 

DeWaal Pharmaceutical
Kaspar van de Velde – Chairman  Christian Meyer – HR Head  Albert Schenk – Director, Sales and Marketing

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Facts

Issues

Possible Actions

Strength Weakness

Solution

Positions bargained in the new company

DeWaal: Lead HR, Operation in Europe and Global Marketing BioHealth: CEO, CFO, COO, Head of R&D

Indian Institute of Management Raipur

Steve had worked tirelessly on clearing the regulatory hurdles presented by FTC (Federal Trade Commission) and EC (European Commission)  Meeting between the two heads and the HRs where final decisions need to be taken

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Indian Institute of Management Raipur

ISSUES
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Facts

Issues

Possible Actions

Strength Weakness

Solution

Bringing two very different cultures together.  Selecting the top layers of management for the new company as there were 120 people for 65 seats available.  Talented people from both sides were leaving.  Competitors are head-hunting the in-house employees.  Need to demote several performing employees.

Indian Institute of Management Raipur

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Facts

Issues

Possible Actions

Strength Weakness

Solution

Steve planned to close a DeWaal plant in Indonesia but Kasper was against it.  Christian Meyer wanted to do a lot of testing of the executives – IQ, EI, etc – which Steve hated.  Who is to head the Bangalore plant operations.  Rumors of tension between Steve and Kasper.  Stock prices dipped by 20%.  The company got downgraded in rating.

Indian Institute of Management Raipur

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Indian Institute of Management Raipur

POSSIBLE ALTERNATIVES
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Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 1  Cross-culture training  Dividing the employees according to the size of the companies.  Create parallel posts where ever necessary ( Eg. Sales and Marketing Asia Pacific and Sales and Marketing US and Europe)  Give the employees an incentive and motivation to stay associated with the company.  Find different use of the existing facilities. ( Eg: Indonesian Plant)

Indian Institute of Management Raipur

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Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 2  Performance Evaluation - Grading the employees based on their capabilities and then selecting the best  Retain the one who is better in comparison to the counterpart.  Assessment of the Indonesian plant and other locations through a third-party consultant ( to avoid conflict ). Shut down the ones that are not necessary

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Indian Institute of Management Raipur

Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 3  Experience counts rather than IQ and EI  Give paid long-leaves to the employees so that we can call them back when the company grows.  Outplacement – employees are given this option  Voluntary retirement option can be made available.

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Indian Institute of Management Raipur

Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 4  Choosing the best option as per the situation.(Mix of the Alternatives)  Being transparent with the employees and explaining the future course.  Present a positive picture to media. Giving statement on the acquisition that there are is no tension between the two heads.

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Indian Institute of Management Raipur

Indian Institute of Management Raipur

STRENGTH / WEAKNESS ANALYSIS
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Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 1
Strengths
     

Weaknesses
Indian Institute of Management Raipur

Lot of cash reserves measuring up to $8 billions. Larger and Multinational Market. Economies of scale and strong distribution network. Large and skilled work force available at hand. Loyalty of employees. Reduces attrition rate.

   

Cross-cultural differences may arise. Restructuring the organizational hierarchy Relocation of employees. Employee expenditure is high. (salaries and trainings etc.)

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Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 2
Strengths
Scientific approach to know who is good and who is not.  Identification of talent and facilitate their growth.  Objective oriented approach can help the organization grow.

Weaknesses
Indian Institute of Management Raipur

    

The grading / evaluation system may not always be accurate. May lose valuable experienced employees. Can lead to conflicts in the senior management. May result in poor employee loyalty Increases the attrition rate due to lack of trust. Can lead to bad Press.

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Facts

Issues

Possible Actions

Strength Weakness

Solution

Alternative 3
Strengths

Weaknesses
Indian Institute of Management Raipur

   

Gives time for the management to focus strategy and plan accordingly. Opportunity to call back the employees when required. Outplacement can give more exposure to the employees. Employee loyalty. No bad press.

 

Increased expenditure on the employees. May lead to increased attrition rate if kept on leave/outplacement for longer duration.

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Indian Institute of Management Raipur

BEST SOLUTION
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Facts

Issues

Possible Actions

Strength Weakness

Solution

 Pre-acquisition

Due diligence
Identify the cultural barriers  Integration of the prominent functions

Indian Institute of Management Raipur

Negotiation

 Creating

a Foundation

Strategy Formulation
Role of Integration Manager  Top Management Selection

Acquisition and Integration workout

Restructuring

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Facts

Issues

Possible Actions

Strength Weakness

Solution

 Rapid

Integration
Indian Institute of Management Raipur

Course Assessment
Effective Communication Strategy  Addressing Employee Concerns

Implementation Long-term Plan Evaluation and Adjustment
Cultural Integration  Conflict Resolution

 Assimilation

Capitalizing on Success

Maintaining loyalty of employees

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Indian Institute of Management Raipur

THANK YOU
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