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Managing the Strategic Dynamics of Acquisition Integration

In: Business and Management

Submitted By indrasuggala
Words 1542
Pages 7
Managing the strategic Dynamics of Acquisition Integration: Lessons from HP and Compaq

Suggala Indraneel 012513187

Aim of the paper: This article discusses about the Hewlett Packard company and Compaq merger and analyzing the final result of the acquisition of the companies. The aim of the paper is to examine the operational integration process, process of formulating the integration logic, and strategic integration processes of two large high technology companies, HP and Compaq, which are well established in a highly dynamic competitive environment. Introduction: In 2001, HP CEO proposed to acquire the high technology computing company Compaq. They expected to have a longer term revenue and profit goals after merging the companies as both of the companies are already grown computing companies. But many of the analysts were against this idea. Even HP board members showed opposition towards the merger leading to a proxy fight. They argued that the integration risk was eventual as there was never a success in big companies acquisition the two companies have their own way of strategies and plans for the development of organization. This varied cultures create integration difficulties, revenue risks offset cost synergies, financial risks etc. This way, proxy fight was severe and success seemed narrow. But finally the organization integration was successful with the involvement of top management. Initially it has seen success in the case of formulating the integration logic, performance goals, integration team, tools development and short term goals achievement. Later in few years after the merge, slowly it became clear that they are undergoing loss in the overall revenue and was missing the long term revenue and profit goals which was predicted.

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