Middle Managements perception of the change in competitiveness : A study of the strategic merger between Toyota and BT in Germnay
Mergers and Acquisitions (M&As) are a popular strategy companies undertake in order to create value and synergies, and also to increase the competitiveness of the firm. Findings from previous studies show that many M&As fail to create value, however there is also existing evidence that they do, where the execution plays a major role. The success of an M&A depends on both internal and external factors such as the competitive strengths of the firm, strategic fit, and growth of the market.
It is argued that problems such as poor management within M&A processes could affect the outcome of the M&A in a negative way. Previous research shows that middle managers play a key role in strategic change processes such as M&As. When companies go through strategic change, the entire company gets involved; however the middle manager is the one who must keep in contact with co-workers, customers, suppliers, and top management at the same time.
The purpose of this thesis was to investigate middle managements’ perception of changed competitiveness after an M&A has been completed. In order to fulfill the purpose, we used a qualitative approach where we conducted a case study and made interviews with middle managers at Toyota Material Handling’s German subsidiary that had recently gone through an M&A process.
Our findings show that when a company is buying another company it needs to see the positive assets from another perspective than only through possible gains in market shares and synergies. When the two companies merge they must take advantage of each other’s specific resources that have made each company successful. Furthermore what fosters increased competitiveness after a merger is good information and communication about goals and strategies. What in turn hinders increased competitiveness after a merger is low flexibility in terms of not being able to adapt to market changes fast enough, and to have an organization that does not make it possible for employees to bring up their opinions.
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