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You are part of a company who has made the strategic decision to acquire another company. There are two possible implementation strategies for this decision:

A. Merge the acquired company into your company. The result of this strategy will be one company containing the elements of both companies.

1. What are the pros and cons of this implementation strategy?

2. How will you know if the strategy is working?

B. Operate the acquired company as a separate business entity. The result of this strategy will be two separate companies under one senior management â??umbrellaâ? (the senior management team that is responsible for running both companies).

1. What are the pros and cons of this implementation strategy?

2. How will you know if the strategy is working?

Objective:

Use effective communication techniques.
Identify examples of good and bad business practices in the use of strategy design components.
Research and discuss some of the changes occurring in the way that organizations structure themselves and their work.
Analyze the relationships between a firm and the political and economic forces within its community.

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Management of acquisition: Merge the acquired company in, or operate it separately

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A. Merge the acquired company into your company. The result of this strategy will be one company containing the elements of both companies.

1. What are the pros and cons of this implementation strategy?

The main benefit of this strategy will be that synergies can be obtained by operating the two separate companies in one merged entity. For example, combined resources can yield significant synergies due to economies of scale.

The main disadvantage will be that if culture of the two companies is not same, integration of ...

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Sandeep Bardia, MBA
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  • BCom, SGTB Khalsa College, University of Delhi
  • MBA, Rochester Institute of Technology
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