Merger of Ba and Iberia
In human resource management, when taking an employee’s perspective, a company’s merger can be considered as a major process of organizational change. Such a change can, at times, prove to be a major failure like the merger between Digital Equipment Corporation and Compaq (2002) or Daimler-Benz and Chrysler in (1999) both cases failed miserably due to cultural clashes. According to Albert and Whetten (1985), an organizational identity is defined by its key main features which are characterized by (i) what employees think is important to the company; (ii) what differentiates the company from other companies in its employees viewpoint; and (iii) what employees perceive as surviving, i.e., connecting the company’s past with its presence (cf. Gioia, 1998).When mergers take place, as shown in experience, many internal difficulties arise due to the organization’s structural change.(Buono & Bowditch, 1989; Larsson, 1990; Haspeslagh & Jemison, 1991; Greenwood, Hinings & Brown, 1994; Olie, 1994) in specific, new members join the new organization, which can then lead to human resource problems and difficulties like other areas of expertise in an organization face.
The theme of this essay will revolve around the chapters of Mergers & Acquisitions and highlight key issues and difficulties which emerge when two corporate bodies come together under one roof to achieve a common goal. This study concentrates on the merger of British Airways (BA) and Spain’s largest air transport, Iberia. This merger will face many difficulties in the near future due to unfavourable characteristics. This essay will be discussing one of the key difficulties the merger will face, followed by suggestions of suitable interventions.
Keywords: Merger, Employee, Culture, Relationship, Training, Retention
International Airlines Group (IAG) - Organizational Chart
(Source: The Official Board website)
The new entity which was formed with their collaboration is called International Airlines