Human resource issues entailed by the take-over of Credit du Nord by Society General (2004)

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Human resource issues entailed by the take-over of Credit du Nord by Society General (2004)

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Abstract

The French banking system has met several restructurings since the 90's. Banking networks have now to propose, diversify and evolve services to their customers. Besides, these companies are in a more open market which entails international competition and the mergers phenomenon. Several examples show that this tendency affects the French banking system: the BNP and Paribas merger in 1999, the take over of Credit Lyonnais by Credit Agricole in 2003… Besides, the advent of single currency in 1999 accelerated the settlement of a Single European Banking Market; in fact, euro eases capital movements between member countries by making easier the financial products homogeneity and prices transparency. International comparisons bring forward the fact that French Banking System has an excellent rank. In fact, according to their assets or statements of account, French Major Banks are in the top first: Credit Agricole is ranked 5th with $46 billion of assets, BNP-Paribas is ranked 10th with $24 billion, Society General is 26th with $16 billion and Credit Mutuel is 35th with $13 billion…

Introduction
1. The sector
2. The issue
3. The company
4. Group stucture
5. Presentation of Mr Charles Million
The stakes in HR policy during the take-over of Le Credit Du Nord by La Societe Generale
1. An originally strong corporate culture
2. Manpower planning : the optimum use of available human resources
3. The need for apraisal and communication
4. The important role of the industrial relations
Difficulties encountered and solutions brought
1. A more and more individualist system
2. Manpower planning and the social plan
3. Find the most performant people and make the others accept the decisions
4. The 'barrier' between Directors and Trade Unions
Analysis, critics and recommandations
1. The adaptability of the personnel
2. The risk of inertie
3. The role of the managers
4. Improve communication with the trade unions
Conclusion

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[...] Here, in the case of Crédit du Nord, the characteristics of the banking sector and the values defended by the Directions allowed a kind of stability in the change. Indeed, many workers were made redundant, many others were reshuffled among subsidiaries. But those who stayed proved their performance and made the current success of the firm. A strong team was actually built around solid potentials and dialogue as well as regular competencies checking were put forward. Yet one drawback of the change has to be highlighted. [...]

[...] In general, lots of tools have been tested, discussed and reviewed by the directors and the trade unions. One of the biggest difficulties in appraisal lies in its subjectivity. Anytime, people can mention unfairness nay discrimination. There are several methods to appraise: the simple ranking which is a normed- referenced technique, the pair-wise comparison, the rating method with a scaling from 1 to 5 for example, the behavioral checklist, the critical incidents, and the comparison with objectives, the interview and even the 360° feed-back. [...]

[...] For example, trade unions members can ask questions and take the time to read the answers without getting nervous and vice versa. In many other companies, the web has been a marvelous tool to facilitate the merger and integrate two societies when they had completely different values. It was the case of HP and Compaq; so why this system can't be used to calm down relations between top management and trade unions? Conclusion The transfer of Crédit Du Nord by Paribas to Société Générale was one of the hardest challenges [...]

[...] Considering the evolution of the economy and the imperatives of this competitive sector, we understand now why its take-over by Society General occurred in 1997. The issue Crédit Du Nord has been taken over in 1997 by Société Générale. This is one of the many examples showing that the mergers phenomenon is not finished yet. Moreover, one is to know that such an event entails a restructuring plan. This logically leads to lay-offs, jobs reorganization, it also usually involves negotiations with trade unions A merger merely changes the entire working organization of the company. [...]

[...] “Favor adequation between competency levels and evolution wishes of each employee” (“Favoriser l'adéquation entre les niveaux de compétence et les souhaits d'évolution de chacun”) is one of their mottos Find the most performing people and make the others accept the decisions As it is said above, this merger between Crédit Du Nord and Société Générale required the leaving of around 6000 employees from both societies. Even if the manpower planning has already set up the new organization in terms of positions, the difficulty for the Human Resources Director remained in the choice of employees to be kept or not. [...]

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