The Merger – A Case Analysis Report

I. Facts of the Case

Peter Lundgren had taken too much coffee before the meeting with Stanley Ashton. They were collaborating as co-CEOs of Arlington Inc., a company which resulted from a merger of Arlington Oil with Duns Ford Petroleum Co. This would be an asset in the industry.

The merger envisioned a corporation in the rough-and-tumble oil industry that would achieve significant cost savings in refining, marketing, and transportation, as well as capital to fund worldwide exploration and production.

The most challenging part was the integration of two organizations has begun, which is believed to generate effective human resource integration strategy that will result to operating efficiencies.

Arlington was left with two managers for almost every available position at upper and middle management level. Prior to the merger, the top levels had been selected. Lundgren and Ashton had decided a negotiation that they could keep their most trusted executives on board.

Peter has always preferred making decisions by instinct and likes to talk o people face to face to assess if they are fit for the position, becoming biased toward some of his own executives. Ashton, on the other hand, was vey objective and has a very conventional way of making his executives pass through a series of tests. Peter was concerned in the idea that an objective process such as that of Ashton would make the best people around him leave, when they undergo all the evaluations.

II. Key Problem

Arlington Inc. has been facing a problem in creating an effective human resource integration strategy. Both CEOs have their own different and opposite ways and qualities of people who deserved the best positions, and by that it is possible that they will find conflict in going through each other’s decision making.

The merger of the companies could potentially generate an asset that may boost their performance and income. This opportunity also brings collaboration of two different cultures to come up with a better solution in handling human resource, particularly in deciding who will be chosen as the managers at every position. The decision would be solely based on the qualifications of the employees and whether they are assets in the company, made through evaluation. Peter and Stanley were facing a dilemma on the possibilities that they won’t be able to weigh all the elements of evaluation, and lose the best people.

III. Objectives

The mergers should meet each other’s satisfaction on who will be chosen for the position or to make a way for them to come up with a decision without ones regret. The following objectives should be considered:

* To have a successful merger of both companies * To merge both cultures of the two different companies * To find a way of selecting the people who are best fit for the company’s success

IV. Analysis of the problem

The merging of the two companies, Arlington Oil and Duns Ford Petroleum Co., has been facing a dilemma in making an effective human resource integration strategy, due to the different perspectives, strategies, and approaches of the two CEOs, Lundgren and Ashton. Peter Lundgren relies on his gut instinct. He is the top manager who appraises his people through personal interest and interview, then decide if they would fit with the organization. He will probably choose a confident man, who will always feel right, rather than a man who’s good in paper. The only defect on his perception is that sometime he became bias. While Ashton, on the other hand, has a different dominant style. He wants his people to undergo an evaluation and follow a process, this includes personality, IQ, and emotional intelligence testing, and all sorts of other tests.

Given the condition, the two mergers should make compromise and nonprogrammed decisions, which are made response to situations that are unique for them (since they have different strategies and approach) and unstructured organization.

V. Development and Selection of Alternatives

The CEOs should set aside their differences and hear out each other’s approach to come up with the best solutions. Since they have totally different strategies and perspectives in their managerial experiences, they should discuss their ideas and weigh the pros and cons of every step they make.

One option is to involve more communication and know more about the employees through interviews and asking about their visions about the company. The CEOs could create a tool to measure and evaluate them and rank them according to who satisfy the criteria they made. Its advantage would be that tension between the two would be alleviated and that they also have contribution and they are also empowered. The negative side would be that it would turn out bad that it could create more conflict, like putting gasoline to fire. They may also encounter a lot of difficulties in deciding if somebody rejects the idea of the other.

Another option is that Peter could try to adapt the idea of assessment through evaluation based on the credentials of the employees. With this, he would have estimated the capabilities of everybody and start evaluating and deciding based on it. He could obtain inputs from the supervisors of the employees, basically investigating each person. Gathering opinions about that person would be very helpful in deciding who fits in the position and gauge their abilities. However, this may involve bias due to the fact that we have differences in opinions.

Lastly one good option is to give employees opportunities to showcase their abilities through observation of their performance and evaluating them. The last man standing, or the one who exhibited remarkable performance should be the one deserving the position. With this approach. There will be no bias done. The company would be regarded as fair in its policies (in human resource) as it allowed everybody to show what they can do given the parameters set.

VI. Selection and Justification of Chosen Alternative

The best and ideal strategy to use is the last option- to provide employees opportunities to prove themselves and get to know them. With this approach, you are disregarding other factors like looking into the credentials of the person, and not considering their achievements and who they are. This would allow everybody to strive to what they can do and reach the expectations and attributes that the position demands. Using a good tool would measure what they can do; it’s like subjecting everybody to pressure and determining the rightful one. This is important, considering that it will be administered in a merger where cultures varied.

However, this could be another effort for them that they are expected to exhibit great performance despite of the uncertainty of getting jobs. Thus not all of them might take the challenge, and there is also a possibility that just a few would grab the opportunity. This demands time for evaluation, but it will be all worth it when it succeeded. It would be like finding a needle in a haystack, or looking for gold deposits in mud. And after doing so, all the hardships and downfalls would pay off. The company would benefit eventually in the long-run.

VI. Recommendation

Brainstorming, choosing and deciding on what approach to take does not guarantee success. Every step involves risk, and companies involved in mergers are gambling on the possibilities in achieving high performance, delivery, and fiasco.

In the case of the Arlington Inc, the two companies had different cultures, and people were struggling and adjusting with the new merger. Employees and even the CEOs are familiarizing themselves to the other. Even if Lundgren and Ashton do not share perspectives and strategies, it is not impossible for them to harmonize and lead the new company with a new approach. They have to set aside their differences and compromise in order to plan, organize, lead and control.

They could accept the evaluation process and appoint people who deserve the positions, and adjust to differences. Later on, they may undergo transformation or modification in order to align/achieve both their old visions. They could organize a capacity building activity to reinforce and boost their employees motivations, set their short-term and long-term goals and how they are going to work for them, and most importantly communication lines that are open to accept fresh ideas and innovations.