Case Study Description of Note on Postmerger Integration
Approximately 65% to 85% of mergers fail. That's a startling statistic. While there are myriad reasons why mergers are not successful, in many cases the reason is simple: a failure to develop and execute an appropriate postmerger integration (PMI) strategy. Clues to successful PMIs can be gleaned from the 15% to 35% of mergers that do succeed; this note contains some tips and best practices distilled from those successes. Because every company and every merger is different, this collection of practices is by no means exhaustive. Instead, its purpose is to serve as a starting point for the creation of a well-tailored strategy for a firm planning to undertake the assimilation of an acquisition into a new, combined entity.
Swot Analysis of "Note on Postmerger Integration" written by L.J. Bourgeois, Lipi Patel includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Postmerger Mergers facing as an external strategic factors. Some of the topics covered in Note on Postmerger Integration case study are - Strategic Management Strategies, and Organizational Development.
Some of the macro environment factors that can be used to understand the Note on Postmerger Integration casestudy better are - – digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, there is backlash against globalization, geopolitical disruptions, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies,
increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Note on Postmerger Integration
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Note on Postmerger Integration case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Postmerger Mergers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Postmerger Mergers operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Note on Postmerger Integration can be done for the following purposes –
1. Strategic planning using facts provided in Note on Postmerger Integration case study
2. Improving business portfolio management of Postmerger Mergers
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Postmerger Mergers
Strengths Note on Postmerger Integration | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Postmerger Mergers in Note on Postmerger Integration Harvard Business Review case study are -
Diverse revenue streams
– Postmerger Mergers is present in almost all the verticals within the industry. This has provided firm in Note on Postmerger Integration case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Learning organization
- Postmerger Mergers is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Postmerger Mergers is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Note on Postmerger Integration Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Postmerger Mergers digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Postmerger Mergers has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Low bargaining power of suppliers
– Suppliers of Postmerger Mergers in the sector have low bargaining power. Note on Postmerger Integration has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Postmerger Mergers to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Organizational Development industry
– Note on Postmerger Integration firm has clearly differentiated products in the market place. This has enabled Postmerger Mergers to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Postmerger Mergers to invest into research and development (R&D) and innovation.
Training and development
– Postmerger Mergers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Note on Postmerger Integration Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Analytics focus
– Postmerger Mergers is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by L.J. Bourgeois, Lipi Patel can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Postmerger Mergers are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Superior customer experience
– The customer experience strategy of Postmerger Mergers in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Organizational Development field
– Postmerger Mergers is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Postmerger Mergers in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Postmerger Mergers is one of the most innovative firm in sector. Manager in Note on Postmerger Integration Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Postmerger Mergers has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses Note on Postmerger Integration | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Note on Postmerger Integration are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Postmerger Mergers is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Note on Postmerger Integration can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Postmerger Mergers has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Slow decision making process
– As mentioned earlier in the report, Postmerger Mergers has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Postmerger Mergers even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Interest costs
– Compare to the competition, Postmerger Mergers has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
No frontier risks strategy
– After analyzing the HBR case study Note on Postmerger Integration, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Note on Postmerger Integration HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Postmerger Mergers has relatively successful track record of launching new products.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Postmerger Mergers supply chain. Even after few cautionary changes mentioned in the HBR case study - Note on Postmerger Integration, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Postmerger Mergers vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Note on Postmerger Integration, it seems that the employees of Postmerger Mergers don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Workers concerns about automation
– As automation is fast increasing in the segment, Postmerger Mergers needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Aligning sales with marketing
– It come across in the case study Note on Postmerger Integration that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Note on Postmerger Integration can leverage the sales team experience to cultivate customer relationships as Postmerger Mergers is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of Postmerger Mergers, firm in the HBR case study Note on Postmerger Integration needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Note on Postmerger Integration | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Note on Postmerger Integration are -
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Postmerger Mergers to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Postmerger Mergers in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Postmerger Mergers to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Postmerger Mergers to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Postmerger Mergers to increase its market reach. Postmerger Mergers will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Developing new processes and practices
– Postmerger Mergers can develop new processes and procedures in Organizational Development industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Postmerger Mergers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Postmerger Mergers can use the latest technology developments to improve its manufacturing and designing process in Organizational Development segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Building a culture of innovation
– managers at Postmerger Mergers can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Organizational Development segment.
Using analytics as competitive advantage
– Postmerger Mergers has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Note on Postmerger Integration - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Postmerger Mergers to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Postmerger Mergers in the consumer business. Now Postmerger Mergers can target international markets with far fewer capital restrictions requirements than the existing system.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Postmerger Mergers can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Postmerger Mergers can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Loyalty marketing
– Postmerger Mergers has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats Note on Postmerger Integration External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Note on Postmerger Integration are -
Environmental challenges
– Postmerger Mergers needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Postmerger Mergers can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
High dependence on third party suppliers
– Postmerger Mergers high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Consumer confidence and its impact on Postmerger Mergers demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Postmerger Mergers.
Regulatory challenges
– Postmerger Mergers needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Organizational Development industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Postmerger Mergers can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Note on Postmerger Integration .
Shortening product life cycle
– it is one of the major threat that Postmerger Mergers is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Postmerger Mergers can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Postmerger Mergers needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Postmerger Mergers has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Postmerger Mergers needs to keep up with the evolution of technology in the Organizational Development sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing wage structure of Postmerger Mergers
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Postmerger Mergers.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Postmerger Mergers in the Organizational Development industry. The Organizational Development industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Weighted SWOT Analysis of Note on Postmerger Integration Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Note on Postmerger Integration needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Note on Postmerger Integration is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Note on Postmerger Integration is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Note on Postmerger Integration is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Postmerger Mergers needs to make to build a sustainable competitive advantage.