Merging and Acquisition

Merging Process can be defined as reorganization, where one company absorbs the structure of another company. In this process, only one company retains its identity.

Acquisition: One company taking over and controlling the interest of another company.

These processes generally involve a cultural shock when joining, since this involves interaction between cultures and we all know cultures are very different.

Name different positive and negative impacts that merging processes can bring to the already established corporate culture?

Positive:

-Merging can be good because it can increase the economical power of the company. When joining both companies integrates their economical power, therefore the growth of the company will accelerate.

-New ideas may arise; the joining of both companies can give a fresh start to this new one.

Negative:

-One of the companies that joined will usually be in a disadvantage; one will have to give away more than the other

-The corporate and the cultural differences can be a struggle when working together. This can lead to misunderstandings, disagreements and bad communication.

References:

Merging business Need new identity. Competitive advantage, http://www.cadvantage.co.uk/cms/site/images/Merging.jpg. August 10, 2011.