“The culture of an organisation refers to the unique configuration of norms, values, beliefs, ways of behaving and so that characterises the manner in which groups and individuals combine to get things done. It is manifested in the folkways, mores, and the ideology to which members differ, as well as the strategic choices made by the organisation as a whole” (Eldridge and Crombie, 1974 p. 89). The cultural aspect within most mergers and acquisitions has been an area that has been overlooked. There has been estimations and evidence that the failure rate for Mergers and Acquisitions is greater that 50%, and this evidence also suggests that a lack of understanding towards the human capital as the primary source of failure (Deogun and Lipin, 1999; Ho, 2000; Rovit, Harding and Lemire, 2004). These failures will negatively impact the human aspect of the organisation, but the management of these organisations fail to see this, as a proper assessment was not done, nor the proper systems put in place.
It has been identified that “ mergers and acquisitions creates the most dramatic changes that most people will experience at work” (Holbeche, 1998, p. 44. During this integration process the management of the organisation should highlight and convince the employees of the importance of this change, as this will assist each individual in managing the change (Cianni, 2002). This also can be instrumental for the employees in accepting the change and help in the way forward in the new organisation, as the employees of any organisation can drive the intellectual capital, industry relationships, trade secrets and collective knowledge, thus fuelling both the internal and external opportunities of the organization (Ssveiby, 1997).
1. Purpose of the Study
The purpose of the study is to assess and analyse the effects on employees of any organisation if proper due diligence is not conducted during and after a Merger and Acquisition. Also to gain a better...