Merger and Acquisition Challenges
Student-written example
Shared for study and reference. Not a sample of our professional writing.
About this example
This assignment was contributed by a student. The views expressed are the author’s and do not necessarily reflect those of UKEssays. Use it to inform your reading and develop your own work.
Question
What are some of the major challenges companies face when confronted with a merger and acquisition strategy?
Answer
Three major challenges that companies are likely to face when implementing a merger and acquisition (M&A) strategy are as follows.
Communication challenges can be a big problem when companies merge together or one is acquired by another. Middle management and employees are generally left uninformed that a merger or acquisition is happening and this creates uncertainty. It can also create a culture of fear and often leads to rumours being spread by employees about the future of the organisation. This lack of communication can create employee mistrust and can often lead to them becoming demotivated because of the uncertainty they face.
The next challenge is linked to the communication challenges and is a challenge regarding employee retention. As employees face uncertainty at their current job they often begin to look for another job because they don’t know if they are going to retain their job role once the merger of acquisition has been completed. When completing a merger or acquisition it is important to retain as many staff as possible as this helps to maintain business continuity, and because it is, typically, rather costly to hire new staff.
Cultural challenges are another type of challenge that organisations face. When companies merge together or one is acquired by another it is important to consider the cultures of the organisations. If the companies have different cultures it can often be difficult for the employees to work together. This is because they will be used to completing tasks in different ways to the other company. This can lead to inefficient work processes and a drop in productivity. This can mean that the expected benefits of conducting the merger or acquisition can be lost and synergy is not achieved.
References
UK Essays writing support
Need support with your own question?
Get help from our experienced academic writers. All hold at least a 2:1 degree from a reputable university, and most hold a master’s degree or PhD, and/or have teaching experience.
Send us your question and, if you wish, any marking criteria. We’ll write a model answer to your brief.
Cite This Work
To export a reference to this article please select a referencing stye below:
Related Services
View all
DMCA / Removal Request
If you are the original writer of this assignment and no longer wish to have your work published on UKEssays.com then please click the following link to email our support team:
Request essay removal