Mergers, De-mergers and Strategic Alliances

Abstract

In most coherent organisations, there is some sense of identity and strategic direction. People may not be able to articulate it and it may be blurred by a business unit identity, but there is normally some glue that holds everyone together in the pursuit of a common purpose. In quite large organisations there is normally an accepted way of doing things: a set of cultural precedents that people can draw on. All of this, however, can become unravelled when the status of a company changes. When an organisation merges, de-merges or allies itself with another, questions about what the corporate brand means for both internal and external audiences start to be asked. There is uncertainty and fear and a lack of understanding as to what the new relationship with the organisation will be. Its values and purpose may change — factors that perhaps had determined the reason for the relationship in the first place. Its strategy may alter and change the business rationale for being a stakeholder. At worst, the company may cease to be a friend and become an enemy.