Management and Leadership

1. Chapter 7:
Anjan Sarma
MEM (Master of Engg. Management) Course work, 4th
Semester
@St Cloud State university, MN USA
_____________________________________________________________________________________
Page 1 of 6
Critical thinking Q1:
We have organized this chapter by activities that need to take place to successfully
integrate or blend the entities involved in an external acquisition of technology. What are
many aspects of the blending process? What would you say are the most important
outcomes for a manager to see from the implementation phase? Discuss what the
manager can do to ensure that integration moves forward.
ANS:
In mergers and acquisitions there are number of concerns for each of the key areas –
Leadership, Integration, Execution and Alignment. When the acquisition of firms
happens there are two different operating procedures coming from two different
companies and
so is the leadership and almost everything else. Blending and integrating them into one
is the biggest challenge. The following are three important processes that must be taken
into account during execution of blending.
 Due diligence
 Shared lessons
 Blended structures and cultures
The combined management of the merged firms should take much due diligence during
the integration process to prevent loss of talented people and key resources from the
company. The bright employees leaving company is a loss for the company and also

2. Chapter 7:
Anjan Sarma
MEM (Master of Engg. Management) Course work, 4th
Semester
@St Cloud State university, MN USA
_____________________________________________________________________________________
Page 2 of 6
creates potential competitors.
What are many aspects of the blending process?
Blending process involves two key entities:
 Structures
 Cultures
The resulting structures and cultures in a post merge period depend on number of
factors and could be one of the following:
1. Separate culture: The culture of the new company could be separate from the
both merged entities. This is true especially in case of unrelated acquisitions
where new Strategic business Unit may emerge and could work in a different
structural and cultural environment.
2. Dominant culture: In this case the larger firm’s culture will be a dominant one and
inherit to the new company.
3. New culture: This occurs when merged entities will have some common grounds
and in this case the merged entity will have some greater blending and emerges
with a new culture. This is truly desirable.
4. Sub culture: Sub cultures may exist within a company, especially when company
may have many vertical SBUs and each SBU may have a different culture of
working. This is particularly true if the company is spread over different

3. Chapter 7:
Anjan Sarma
MEM (Master of Engg. Management) Course work, 4th
Semester
@St Cloud State university, MN USA
_____________________________________________________________________________________
Page 3 of 6
Geographical location.
What would you say are the most important outcomes for a manager to see
from the implementation phase?
The managers should take utmost care to achieve the following:
 Start early and provide clear vision
 Proper due diligence
 Consider customers
 Dedicate sufficient resources to implementation
 Communication and systematic knowledge sharing
 Training and Development
 Encourage employee participation
 Speed of transition
 Reward activities which lead towards successful implementation
Discuss what the manager can do to ensure that integration moves forward.
The managers can create incentives for cooperation among various groups that will
interact. Blending just does not happen and it requires efforts.
1. Create incentives for cooperation among various groups that will interact.
Recognize the need for each partner to do what it does best. This requires
specialization and trust.

4. Chapter 7:
Anjan Sarma
MEM (Master of Engg. Management) Course work, 4th
Semester
@St Cloud State university, MN USA
_____________________________________________________________________________________
Page 4 of 6
2. Share information, personnel, systems and whatever else is needed to reach the
goal.
3. Treating the alliance partner as the same way you want to be treated.
4. Exceed expectations of the partnership to build trust in the relationship.
5. Being flexible and dynamic for a better partnership.

5. Chapter 7:
Anjan Sarma
MEM (Master of Engg. Management) Course work, 4th
Semester
@St Cloud State university, MN USA
_____________________________________________________________________________________
Page 5 of 6
Discussion Question Q3: Why do so many firms pursue mergers and acquisitions if the
integration of such combined firms is so hard and the results are so unsatisfying?
ANS: The merger and acquisition comes mainly for all the following reasons:
1. To acquire broader market for the merged entity and to gain on competitors.
2. To acquire superior technology and practices that help merged entity to gain on
competitors.
3. To cut costs and survive through some difficult economic times.
Technology companies like Microsoft and Google constantly evaluate external
technology and build strategies to embed new technology in their product line. For
example, Microsoft in recent times acquired Skype as a strategic move to enable PCs
for video conferencing over the internet and in a move to embed this in the future
version of Windows operating system. Skype already enjoys tens of millions of
subscribers and by acquiring Microsoft reassures and expand its product functionality.
Another example, why companies still merge is Delta airlines and North-west airlines
merger. The two companies were making tens of millions of dollar loss every quarter in
a slumping US airline market. Both airlines realized that cost cutting and route
rationalization would be necessary for both airlines to avoid the redundancy of cost.
Finally, the merged entity Delta airlines then emerged as the world’s largest airline and

6. Chapter 7:
Anjan Sarma
MEM (Master of Engg. Management) Course work, 4th
Semester
@St Cloud State university, MN USA
_____________________________________________________________________________________
Page 6 of 6
gradually started returning as a profit making company.