Acquisition is a continual process, not an event (Carpenter & Sanders, 2007). It seemed to be a win-win situation when Watkins International acquired Brownloaf MacTaggart (BM), which until the acquisition in 1988 had been a prestigious small consultancy practice. However, a series of organizational problems arose after BM became one division of the international corporate empire. The shift means sudden changes in management styles and enterprise institution. As a consequence of inappropriate integration, the former BM staffs encountered a clash with Watkins' culture and values. Furthermore, the firm seems to lack in sophisticated goal setting and reward policies under the undetermined leadership. This essay will attempt to analyse several crucial organizational issues in this case and identify conceivable influence if the problems are not addressed appropriately.
2.Organizational Issues in the Case
2.1Integration and Organizational Culture
Despite optimistic expectations, mergers and acquisitions occasionally fail, in part because managers neglect cultural issues, which are rarely considered until serious problems arise. Schein (1985) defined organizational culture as: “A pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration which has worked well enough to be consider valid.” According to Schein’s Three Levels of Culture model, implicit assumptions and underlying values manifest staff’s behaviour on the surface level. The typical management consultant in Watkins is ambitious, experienced and academically excellent (from a reputable British business school), while the typical BM consultant has a lower level of education, usually majored in engineering. The different personal experiences and characters shape different social behaviours and then generate the culture in an organization. On the aspect of individuals, employees in BM division are less well qualified and have lower motivation. Arguably, a climate of self-proclaimed inferiority and anti-intellectualism flourished in BM, through excessive drinking and a negative work attitude. On the aspect of organizations, the former somewhat discursive enterprise culture made it difficult for BM staff, and even the partners to adapt a fiercely competitive environment in Watkins. Hence, BM presented a distinctive style that unaccustomed to the organizational climate within Watkins.
A specific integration plan including culture integration should have been worked out and thoroughly executed at the very beginning of this acquisition. Attributable to a lack of employee training, the BM staff felt confused when they moved into an increasingly automated and tightly regulated office from a relatively small personal one. Marks and Mirvis (1985) have argued that, compared staff response to a merger of acquisition to a death or a bereavement, in the way it is denied it to begin with, before later expression of anger at leadership and allowance of biases to create conflict in the workplace. For instance, old concepts inherited from a small independent firm made it a tough task to introduce firm-wide standardised practices in BM division. Moreover, cultural problem is also one of the reasons of low work motivation and poor corporate governance.
2.2Reward Policies and Motivation
Generally speaking, motivation is a necessary condition for high performance in business organizations. It is of vital importance for enterprises to set up a system which combine performance with reward or punishment to motivate the staff. A significant Organizational Behaviour theory is that of Expectancy by Vroom (1964), who states that the motive of an individual rely on how much he or she believes that effort and dependable performance will lead to reward. Namely, if there is no chance of attaining the reward then there is low motivation the staff will be willing to work hard. In BM Division, motivation...