The most complex part of merging is determined to be planning. It is significant for the organizations to have proper planning before executing the process of merging. Majority of corporate companies uses this process to gain profit within the marketplace. The paper provides with a clear description of the merging of the consultancy companies followed by classical and systematic perspective. It discusses both the perspectives by using relevant theories used by the companies. It aims to focus on the impacts of working together that affect the business processes and economy of the organization. It also presents different models used by both the companies for better management of their business. It can be seen that the process of merger helps the organizations to increase their costs, productivity, and revenues. Therefore, the paper will evaluate the benefits and impacts of working together of both the organizations within a consulting market.
The classical perspective of management within an organization mainly focuses on improving the output, productivity and efficiency of the organizations and the employees. Generally, it does not focus on the difference between employees or human or behavioral attributes (Whittington, 2001). The classical perspective has a strong influence on the process improvement and modern operations of the organizations. IT Con is considered to be a big public sector consultancy company which is founded in the 1960s which comprise of 40,000 employees across the world. Globally and locally it has several smaller companies to expand geographically and gain business competence. Whereas, Man Con is determined to be a partner owned organization with most of the employees working worldwide. The company was founded in 1990 and had organically developed to gain profit in the management of the consulting market. It is observed that both the organizations merged with a motive of geographical presence and complementarity of both the businesses (Napitupulu, 2018). Man Con had a strong foothold on the management of US consulting market, while IT Con possesses a strong European presence. Complementarity of businesses made it possible to provide solutions that merged competence and IT competence in corporate and strategy change. The idea of complimentary was made by both the companies at the end of the 1990s to take advantages of more diverse and geographical projects that covers a wider part of the value chain that offers customers with a huge scope of quality services. The management consultancy felt the need to get combined as the demand for website design and production as well as knowledge in software was strong.
Further, it was soon realized by web design that their clients would be benefited from strategic and business advice merged with existing offers. Based on the decision of getting together the focus of the integration was on discussing the objective of the merger to get acceptance of the partners and employees (Hitt and Duane Ireland, 2017). Hence, to get acceptance a huge number of activities initially focused upon the management level and then at the lower level of the organization.
A few years before IT Con has obtained Do Con, a management consulting organization before merging with Man Con. This clearly states the fact that the company possesses some experience of IT consulting services and integrating management. This particular experience has been proved to be negative as the employees felt their new colleagues treated badly without giving any respect. Despite such unfavorable behavior the consultants of Man Con were considered to be both competent and nice. It can be seen that the consultants of Man Con were easy to connect with and friendly. Both the organizations maintained the process of strategic management for continuous assessment, analysis, monitoring and planning to meet the organizational objectives and goals. Strategic management process helped both the companies to perform better and to motivate their employees to achieve success (Doz, 2017). At the beginning the reaction of the Man Con consultants towards their new colleagues was positive. At the time of the merger, the technology hype generated a feeling that the business of IT Con offered a valuable and a significant advantage to the strategy business. Merging with most of the consultants in both the companies it aimed to meet the needs of the employees. However, some of the consultants of Man Con expressed a reserved attitude towards the consultants of IT Con. It is observed that the consultants of Man Con feared of getting absorbed with a bureaucratic organization due to lack of understanding of the logic and the specific requirements of the management consulting. Thus, it is significant for the organization to follow the theory of bureaucracy for better management of consulting business to get success. However, it is observed that the company identified their unique competence for better management of the organization in opposition with IT Con who aimed to put an impact on their liberty (Meyer, Neck and Meeks, 2017). After some time the groups of Man Con and IT Con consultants were merged to create new processes and structures. This particular activities provided opportunities for the two organizations to develop a strong relationship with each other. During this process, the top level managers of both the organizations discussed and developed an integrating concept that described client determined integration. As the consultants of both the organizations were from different areas of business hence, the organization structure was entirely based on the development of specialized business units. The job of the consultants was to work together and fulfill the ad hoc projects when there was a need for combined expertise in the client’s projects. To establish the structure both the organizations followed the strategy of developing an integrated offer by allowing for internal differences within the market. This particular strategy was determined to be the significant guiding principle for building the structure of the organizations. Establishing the structure of the organizations helps the firms to set organizational goals (Bettis et al., 2016). One unit of Man Con comprises of few consultants whose job is to manage the consulting market that specializes in dealing with the strategic issues. Another unit within the organization focused on encompassing consultants and traditional IT consultants as compared to IT Con. Here the organizations aim to divide the unit of competencies that will avoid splitting up of an existing work. Although with the initial feeling of complementarity and a good match the variation in business logic and culture of the consultants of Man Con and IT Con became visible (Zhang et al., 2015).
Max Weber introduces a theory of bureaucratic management. It has the most important role in the growth of an organization and has a hierarchy of rules and regulation, decision making, authority, standardized principles, planning, trained administrative personnel and specialized workforce. (L?z?roiu, 2015). Through rule-based activity the performance of an employee is judged and based on the production and merits, promotions are decided. Its main motive was to bring a company’s power structure into focus. This study shows the bureaucracy has many involvements in various field of organization theory (Johnson, Whittington & Scholes, 2011).
Some basic principles followed by ITCon as bureaucratic management are-
IT con had some experience about the IT consulting services and integrating management services, before the merger with Man Con. Though the experience was negative as IT, consultant felt that their new colleagues had disrespect them whereas consultants of Man Con were described as competent and nice (Sturdy, Wright and Wylie, 2016). Most of the consultants of both organizations looked forward to meeting their staffs to be. However, some of the Man Con consultants expressed a reserved attitude towards IT Con. Also, Consultants of Man Con got feared being absorbed into a large Bureaucratic company, they felt less understanding of the management consultancy logic and about the requirements specified. Teams of Man Con and IT Con were brought together to design a new structure and procedure. Bureaucracy created the first opportunity to build strong relations between the employees of the two companies (Di Maio et al., 2017).
As the Consultants are of two different business areas, a new structure of organization based on specialized business units was developed. Consultants with supportive competencies were to meet and work together on the projects of ad hoc when their combined expertise was needed in client’s projects. The structure consists of two dimensions were designed for the newly formed ITManCon are- one dividing the company into different business units according to competencies and the second one that divides into various sectors to focus on clients in specific countries. Therefore the idea of a separate sales organization came from ITCon was a new solution for both the organization (Vittikh, 2015). One unit of ManCon consultants focused on management consulting especially on strategic issues. Another unit whose focus was on traditional IT consulting and encompassed consultants from the former ITCon. The ambition of bureaucracy was to make a team of both the organization ITCon and ManCon management consultants whose expertise lay in IT performance and change management (Amelec, 2015). All process and systems of the two company for sales efforts, reports and performance management were to be united. The number of groups work were created with the assignment to design the common process and new structures for the entire firm. In this procedure, the weaknesses and strengths of each firm existing systems and models were evaluating. In some case, like for time reporting, ITCon model was chosen, and in others, such as for the system of performance management, ManCon model was chosen. To create a support system and common business procedure, the aim of the extensive effort was the growth of the two companies was rather high. Some rule and regulation were made by the management of Bureaucracy for the employees of both the organization based on their performance (Pemer and Skjølsvik, 2016).
Due to frustration, ManCon consultants claimed on ITCon that when they should concentrate on external contact with clients, their focus was too internal and they spent their time too much in meetings. And they are not active too much in doing their business. On the other hand, consultants of ITCon stressed in defense that their business includes surveys and planning and define consultants of ManCon act without thinking and this negative result (Hamilton et al., 2016). As ITCon follow bureaucratic theory, ManCon described their merger partner ITCon as a bureaucratic firm with so many rules.
In a merging of both the companies, bureaucratic organization have failed. An organization with bureaucratic theory have strict rules and regulations, which can slow down their process of work and make communication difficult (Khorasani and Almasifard, 2017). ManCon does not want to follow the theory as it was already a successful organization in the consultancy market and a strong connection with the US market of management consultancy. One of the main cause of the failure is the reserved attitude of consultants of ManCon towards ITCon (Alvesson, 1998)
(Source: Michael, Storey and Thomas, 2017)
Based on the theory of bureaucracy both the organizations were able to manage their business effectively by analyzing and monitoring the performance of the employees within the organizations. Hence, I believed that everybody within the organization has a positive perception based on the process of integration. However, I represented the side of old IT Con, but on the other hand, people viewed the positive contribution of Man Con. Majority of the people were happy with the concept of merging both the companies as they believe that it will gain market shares. Being an IT Con consultant, I believe that merging both the companies would provide greater opportunities for the IT consultants, but it is not sure that the employees and the organizations will gain huge profits. According to my experience, I found a huge difference in the management consulting business and the IT business. It takes approximately 4-5 months to understand the processes implemented by the organization that was believed by the entire organization (Steinbach et al., 2017). I found this huge difference in the experience at the time when I was encountered with my first joint projects.
Systematic perspective reflects upon the individual members of the organization. It helps in solving the problems of the clients to enhance and identify their strengths to provide an understanding of the compassionate and skillful challenges of the clients. It helps the organizational members to work as a partner to recognize and achieve their goals (Engert, Rauter and Baumgartner, 2016). It focuses upon the values, skills, and experience of the employees working within an organization. It is considered to be an overall procedure of an organization based on their business and entity related to their working environment. Systematic perspective provides information about the entire process followed by the organizations to accomplish the activities and set organizational goals. It can be seen that at the time of merging both the companies IT Con and Man Con utilized the information of local activities to discuss the reason behind the merger based on company and personal benefits on a huge scale (Trigeorgis and Reuer, 2017). The objective behind this merger is not only to inform the employees regarding the process but also to make them realize its values. For this both, the companies had conducted an evening presentation at the local theatre to provide an opportunity for the consultants to attend the presentation. The aim is to guide the employees regarding the rationale behind the merger and the potential benefits behind it. It is noticed that after attending the presentation majority of the consultants from both, the organizations find this merger beneficial as it offers consultants with new opportunities in challenging business environment (Coulter, 2013). It was claimed that focusing towards the merging shifts people attention to the rationale of the market instead of personal worries, political battles, and internal processes.
The newly designed structure for both the organizations was based on a matrix that comprises of two separate dimensions. The first dimension divides the business units as per the competencies and the second dimension divides the business units into various sectors that focuses upon the clients in particular organizations. Likewise, another dimension cooperates with the offers facilitated by different units of businesses that includes the major responsibility of the sales (Peng, 2017). Even though the concept of a separate organization for sales was first adopted by IT Con but still this particular solution seems to be new for both the companies. The tradition of sales and delivery were not separated by Man Con, despite the consultants and managers find their projects and act as a salesperson. In the process of integration, a significant set of activities was the alignment of the business processes, procedures, and internal policies. The idea of integration focuses on harmonizing support structures and central business processes. For instance, all the procedures and systems for performance management, recruitment, sales efforts and time reports were harmonized by the organizations (Caiazza and Volpe, 2015). This particular strategy helped both the organizations to design common procedures and new structures based on the assignment. During this process, the strengths and weaknesses of each firms existing systems and models were assessed. Different models were used in different cases by different firms, such as Man Con model was used at the time of performance management system whereas, IT Con model was used for reporting time (Durand, Grant and Madsen, 2017). This is done to reflect upon the huge efforts to develop support systems and common business processes. However, the aim of using the models is to integrate both the organizations. The models helped the organizations reduce the risk of misfit business logic and business system. The organizations followed the strategy of talking several financial precautions to retain key individuals on both a manager level and a partner (Canterino et al., 2016).
During the third phase in 2000, the organizations began to mark the entry of the integration process. The earlier phase was replaced by an awareness of the possible differences among the merging organizations. Therefore, the ambitions of integration were lowered, and the introduced initial structure was reversed by the organization. It is observed that based on the strategies followed by the organizations the first contacts among the employees of both the organizations were determined to be positive (Spence, 2016). Some of the aspects of the working processes made the employees frustrated. It is claimed by Man Con consultants that the focus of the IT Con consultants was too internal where they spend a lot of time attending meetings instead of focusing on external contacts with the clients. This is because the consultants of IT Con followed the theory of bureaucracy whereas, Man Con consultants do not follow this particular theory. This huge difference in the business is because of the implementation of different strategies by both the organizations. It is observed that there possess huge difference and conflicts between the consultants of both the organizations. Both companies follow different models to execute their business processes. This differences created disappointment between the consultants of both the organizations. In the beginning, the consultants felt that working together will help them to expand their business but later observing the culture and business differences made the employees disappointed (Vranceanu, 2014). As both, the companies made use of different theories such as bureaucracy theory by IT Con and administrative theory by Man Con. With the help of administrative theory, Man Con communicated with its employees by way of outputs, inputs and throughputs. These three aspects help Man Con to execute its business systematically without facing any challenges. The administrative theory helped the management to communicate with its employees efficiently. The five functions of administrative theory followed by Man Con were planning, commanding, controlling, coordinating and organizing. All these functions helped the organization to accomplish the managerial, accounting, financial, technical, security and commercial activities effectively (Graebner et al., 2017). The managers within the organizations possess various qualities and skills to manage the resources and people in the company. The managerial qualities and skills such as experience, technical, moral, educational, mental and physical qualities. The consultants of the organizations followed the principles of management based on the five fundamental functions of administrative theory. It is clear from the fact that the organization follows the principles of administrative theory as it always focuses on fulfilling the needs of the employees within the organization. Followed by bureaucracy theory the consultants of IT Con follow too many rules and regulations that made the employees of Man Con frustrated as they were unable to follow certain rules and regulations while executing its business. This difference among the merging organizations led to a decrease in the economy that in turn resulted into decline in the IT consulting market (Thompson and Valentinov, 2017). Hence, on the stock exchange the failed acquisitions, overcapacity, and decreased demand affected the result at the end of the year. Thus, for both, the companies creating sales became the priority. However, as the market began to decline the activities related to integration were reduced, and the focus was shifted from integration to delivery and sales. It also shifted from long-term invention of the new integrated offer to the attainment of short-term outputs.
The organization structure which was recently created to execute the process of merging failed to handle the changing condition of the economy. Meanwhile, the huge difference between the selling IT services and selling management consulting services is considered to be a serious issue. Based on the sales issues the structure developed at the beginning did not last long. The market dimension of the company was removed one after it was implemented (De Jong, Higgins and van Driel, 2015). The decrease in the sales of both the organizations was encountered during the pre-merger period. Hence, to integrate the structures, the initial efforts of the organizations were reversed gradually. Therefore, it is observed that working together of both the organizations puts a great impact on the working process of the firms. It increased the cost of debt because the debt of both the organizations is similar that increased the debt of the balance sheet of the integrated organization. It is observed that at the beginning the consultants felt that it will be good for them to execute the merger process but as the companies started working together on the same project they realized that their opinions do not match with the opinions of other consultants of the merger partner (Iyer et al., 2015). Thus, the consultants of Man Con believes that the theory used by IT Con uses too many rules and regulations that becomes difficult for them to follow within the organization.
As per my experience of being a senior partner of Man Con I acknowledged that people find it cool to execute the process of working. People believed that the process would work out based on the degree of technology hype. It is because our management consulting business executed without having any actual unit of technology. Thus, we believed that it would be beneficial for us to profit from the competencies of IT Con consultants. I observed that most of the employees within the organization believed that IT Con is a dull company with too many rules and regulations. Thus, not a single employee of Man Con was ready to work together with the consultants of IT Con. From the starting point there possess a lot of ambiguity and skepticism while working with the consultants of IT Con (Mathisen and Pinheiro, 2016). As a senior partner of Man Con, I believe the fact that as compared to IT Con we have a better idea about how to do business in the market without facing any problem. I encountered the fact that there is a huge difference in the reward systems of both the organizations. There is a difference in the thinking and opinion of the consultants of both the company. These differences put a negative impact on the execution of the business and achieving the target. I observed that both the companies are using different strategies and theory for the systematic management of the business in the consulting market. Hence, there possess a difference in the opinions of the consultants that put a negative impact on the working process. This massive difference in execution of the business was realized by the consultants at the time when they started working on a project for the first time (Thornbury, 2018). Based on the theory of bureaucracy both the organizations were able to manage their business effectively by analyzing and monitoring the performance of the employees within the organizations. Hence, I believed that everybody within the organization has a positive perception based on the process of integration. However, I represented the side of old IT Con, but on the other hand people viewed the positive contribution of Man Con. Majority of the people were happy with the concept of merging both the companies as they believe that it will gain market shares (Thelisson, Géraudel and Missonier, 2018). Being an IT Con consultant, I believe that merging both the companies would provide greater opportunities for the IT consultants, but it is not sure that the employees and the organizations will gain huge profits. According to my experience, I found a huge difference in the management consulting business and the IT business. It takes approximately 4-5 months to understand the processes implemented by the organization that was believed by the entire organization. I found this huge difference in the experience at the time when I was held with my first joint projects. Therefore, as per my experience, I acknowledged that the consultant of IT Con believes that our integration process is harder.
Conclusion
Acquisition and merger process are determined to be the parts of corporate strategies that deal with the combining of business entities or selling and buying of the products. However, the process of acquisition and merger is a complex process that comprises different steps. It is observed that both the companies IT Con and Man Con adopt the process of the merger to gain profit in business within the market. Initially, the consultants of both the organizations believed that it would prove to be beneficial for them to execute a successful business. As the process began, it is realized that there is a huge difference in the strategies of the firms that affected the business to a great extent.
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