Most HR Managers and strategic planners argue that people are the most important part of any organization. When two companies merge and incorporate a group of people with differing cultures and identities, many companies find it difficult to change the culture and identity one company has relied on for so long in a way that allows for integration of the bidding company's organizational culture (Daniel & Metcalf, 2001).
Conflict always arises in mergers and acquisitions, but cultural conflict is often more prevalent when M&as involve international trade and relationships. To help manage cultural differences, each company must focus on collaborating with one another to discover the similarities and differences that exist between the firms becoming one. The Human Resources Department has a leading role in strategic planning for organizational diversification in these cases, and can severely limit the risks associated with merging divergent cultures by working diligently to promote an environment of open communication, understanding and shared goals and objectives (Daniel & Metcalf, 2001).
Collier (1993) notes that opportunities for "increased size, strength and diversity for cooperatives" are virtually infinite when mergers occur with due diligence (p.4). What this means is to minimize risk, companies have an obligation of performing "due diligence" or assessing what the risks are of working with international firms and assessing whether the risks outweigh the benefits.
Conclusions and Analysis
There are many costs and benefits associated with mergers and acquisitions. As M&as have become increasingly commonplace, it is important for owners and strategic partners to fully assess the risks and benefits associated with such transactions....
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