Managing human capital in the process of merger and acquisition

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Managing human capital in the process of merger and acquisition

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Abstract

Mergers and acquisitions have become a regular business strategy in the present corporate scenario. They involve lengthy and thorough discussions and strategies are worked out in detail before the deals are closed. These discussions influence the future of the organization with respect to the companies involved and their expectations from the employees. Employees represent the human capital of a company and are essential to its seamless functioning. It is important not to distort the capital during the merger to prevent leakage of skills.

However, Human Resources Directors are rarely present at these negotiations. Thus, in the United States, only 16% of mergers and acquisitions have involved the HRD's from the initial phase, although the successful implementation of the operational changes agreed upon depends on them.

Introduction: The importance of the human factor in mergers/acquisitions
The problems encountered in mergers and acquisitions
1. The apprehensions of the employees
2. A new company or two companies that operate in parallel
3. The operational methods used by HR to drive the integration phase
Harmonizing methods
1. Harmonizing HR policies
2. Harmonizing processes
Management skills
1. Conducting a social audit of the company
2. Establishing a synergy of skills
3. Management of internal conflicts
After the merger
1. The establishment of a new corporate culture
2. Performance after the merger
Conclusion

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[...] This communication may be institutional After the merger The establishment of a new corporate culture The process in which a merger or an acquisition has been accomplished will directly affect the culture of the new company. Companies might either impose the existing model or create a new one. While a creating a new model there are greater possibilities of adopting new corporate theories and applications. Such convergence indicates that there is a real desire for integration on the part of the buyers. [...]

[...] The employees, who will now be working together, need to feel involved in the projects of the new company. If they intend to pursue a career in the new setup, they will accept changes in work practices. This harmonization can be achieved without major incidents or total disruption of the integrated company. The processes may be reviewed through group discussions involving the two former managers and an external entity to help decide the appropriate methods for organizing the new setup. [...]

[...] Harmonizing them is one of the central issues in the integration of a company Harmonizing HR policies With regard to HR policies, harmonization of procedures, tools and standards of both companies is paramount. This step ensures a modicum of fairness among employees of the new entity. There are three types of risks that need to be avoided: financial risk: To avoid conflict within the new group, the easiest solution would be to retain the HR policies which are more employee-friendly. [...]

[...] If an item is defined in clear and unambiguous terms, there will be no possible claims on the legitimacy of employees selected. It is the same with respect to the team manager chosen. Thus, a clear definition of business keeps up the competition with the company. The employees of the companies merged will thus be more easily integrated into new development Management of internal conflicts The management of trade unions is and increasingly a complex task faced by HRD in a company, in times of change. [...]

[...] This policy of human synergy is a top priority for leaders deciding the merger and is one of the first fears of employees of both the companies. The jobs engendered are specially those of the support functions and employees who are engaged in identical activities. Employees become apprehensive about losing the benefits they have negotiated in collective agreements. This is particularly true when a company has been integrated in another. Fear of employees is magnified by the staff representative bodies (unions) and is a source of social tension within the company. [...]

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