Strategies for Successful Akbar and Sons Business Acquisition: Navigating Transition and Organizational Culture

Introduction

Organizations in transition often face much challenges in ensuring that the transition is indeed a success. Akbar and sons has been recognized and successful in the running of their business for the past years. This is the main reason why BP has become interested in purchasing the company. However, the human resource and organizational structure definitely has to change to incorporate both the BP culture and maintain the Akbar and sons culture that has made it quite a success. The BP CEO has recognized the need to bring together these two cultures to create a winning formula. However, these means that the company will have to tackle the following scenarios:

Transitioning of senior management: as a part of the changes taking place within the company, Akbar and his son have been offered the options to stay at the company and take up senior management positions or to indeed leave the company. It is expected that the former CEO and his son will leave the company, becoming only stakeholders and advisors of the same. Taking up senior management positions would require that they relinquish much of what they have controlled. In addition, Akbar considers that staying on would only make it more difficult for the employees to take on the expected changes. Having negotiated the terms of the takeover, so that employees will not only maintain their current positions but also play a major role in the building of the company, the CEO has agreed to make the changes complete by leaving the organization.

Changes in organizational culture: as much as the BP manager values the former organizational culture, there is expected to be some changes in order to increase productivity and work towards the objectives of the new company. Much of the changes are expected to be with regard to the chain of command in the new company. Previously, much of the issues were directed to Mr. Akbar or his son. Line managers were barely able to tackle any of the challenges in production and distribution channels. The BP manager on the other hand, will be handling a much bigger company as compared to the former Akbar and sons. He may therefore not be as available as the former CEOs to make everyday decisions. Some of the expected scenario changes will be as follows:

• Employees are expected to take on a much more hands on approach in their daily duties. This means that employees will be expected to deal with all situations and challenges that pertain to their job. Tasks given to specific individuals need to be completed on time, with a high chance of success under minimal supervision. Whereas in the past, employees have relied on supervisors and managers to help them navigate tasks, they will be expected to take on more initiative and manage the tasks themselves ensuring they are successful. This may mean becoming creative and taking on the role of supervisors in their own arena.
• However this does not mean that employees will be left completely alone. Even as they navigate through the challenges of their tasks, managers are expected to have an open door policy. Employees will be given the chance to request for help in challenges that they are finding difficulty in addition to negotiating terms of duties with their managers. By having an open door policy it is expected that communications will improve, employees will enjoy a higher rate of success in completing their tasks and finally will become more satisfied with their work.

Possible Challenges To The Human Resource Transition

Organizational culture: Akbar and Sons has been in operation for quite some time. Majority of the employees in the company have been there for years. Very little change has been experienced in the company in the duration of its existence. The senior management of the company found a formula that worked for then and stuck to it, making few if any changes along the way. Whereas this has created a strong system of teams that are directed towards success, it has also created a problem where company employees are less inclined to deal with change. In fact, it is expected that some changes will be met with resistance from the employees of the company who are used to doing things in a particular manner. Such resistance can only be curtailed using employee engagement techniques.

It is important to note that the decision for change has come from the top management to the lower employees. Unfortunately, a good number of employees may not be on board with the changes therefore creating barriers to the same.

Decreased job satisfaction: for years employees of Akbar and sons have done their job in a specific manner and have met little challenges along the way because they are directly supervised and often have someone higher to turn to for solutions. In the new scenario, employees are expected to deal with the challenges themselves. It is therefore expected that they will develop lower job satisfaction for a short period, since they are not used with the frustration of encountering challenges. However, the manager could start off the employees with smaller tasks which have a higher chance of success ensuring that the success rate is high. With a high success rate, the employees are more likely to be proud of their own accomplishments, confident of their own skills and therefore more willing to take on extra responsibility that may involve bigger tasks with more challenges.

The above challenges may seem difficult and may also provide hindrances to a successful transition period, however, with increased employee engagement in the changes, the solutions to all the above will be found easily and in good time. (Senior 2002) states that majority of the challenges for human resources in periods of change and transition is that lack of communication and engagement with the employees. Employee engagement allows the managers to be part of the solutions for the challenges that the employees are encountering. On the other hand, it also allows employees to have an ear and feel part of the changes taking place in the organization.

POSSIBLE SOLUTIONS

Several human resource matrices are available in the system to provide a background from which solutions to the challenges of transition can be drawn. The BP manager does not need to strictly rely upon the traditional human resource systems where employees are grouped according to the person they report to. This rigidity in itself is quite challenging especially during a period of transition when departments tend to overlap. Generally it can be found that one task has more than enough people working towards its completion, while others are completely lacking. Basing human resource on a matrix that works for the company maybe more ideal in finding perfect and suitable solutions.

Motivation

Maslow’s theory of motivation

Maslow’s hierarchy of needs theory is based on the assumption that employees work to meet certain needs. Management needs to be aware which stage of needs employees are looking to meet, so that they can structure motivation policies. Maslow cites that the triangle of needs begins with physiological basic needs; this is the main reason why employees seek out employment. However as employees grow, they move on to safety needs where employees become more concerned with future security, savings, insurance and investments for securing their own security. This is closely followed by belonging needs, where employees seek out more time with family and friends. Motivation therefore comes from gaining ample time and resources to spend with loved ones. Belonging is followed by esteem, at this stage employees are more concerned with recognition and with rewards that build on their self-esteem. Employees reach self-fulfillment, which as Maslow states is the most likely age for retirement.

Herzberg’s theory and motivation

Herzberg on the other hand stated that motivation is not based on what he termed as hygiene factors. In this case hygiene factors for the employees could include a company car for the new managers and increase in salary for other employees. Unfortunately, the factors are not sustainable. Herzberg suggests that management would better focus on the real motivators which include achievement, recognition and advancement in the new company. With the new company, increased opportunities for growth and challenging opportunities would provide the advantage of lasting motivation.

Motivation and performance management systems

The relationship between motivation and performance management can be made clear by understanding vital aspects where they interlock:

• Performance standards; are identified through the performance management. Clear standards are vital, because employees must understand what measures are being used to identify performance. Haphazard rewards and recognition without clears standards are likely to negatively affect the motivation of employees.
• Identify low performers: the performance management system identifies low performers. It is important that low performers are dealt with decisively. This increases the motivation of workers to at least meet the expected standards of performance.

The performance management system is the best way to increase motivation. However, the managers of Akbar and sons need to be properly trained to identify not just high performers but also the low performers and put forward strategies for improvement.

Employee Performance Matrix :

One of the effects of the challenges of the transition period is a reduction in performance. As employees become more resistant to change they are less likely to perform. The first indicator that productivity within the company is being affected is decreased performance of employees. This matric requires that managers put in place proper measures for productivity which are agreed upon by the employees. As time continues, these managers will be expected to rate the performance of the employees. These performance rate are then used to gauge the average productivity per employee. Performance matrix often challenge employees to do much better and increase their own chances of becoming the best employee of the company. This matrix also, according to (Elsmore 2001) increases the competition among employees of different departments. Employees therefore employ all their talents and skills towards making their job a success and increasing their own performance rate. A continued increase in the average performance rate, therefore means that the company is gaining productivity. On the hand, a decrease could spell doom for the company in terms of profits and productivity.

Employee Satisfaction Matrix

This matrix deals directly with the employee, in support of the performance matrix. Unless employees are completely satisfied in their work, they are less likely to show increased performance at the job. The employee satisfaction matrix is measured using the following variables:

Job satisfaction: this means that employees rate their own jobs highly. They feel that the job satisfies them in terms of meeting their own personal needs. Job satisfaction, as (Graetz 2006) is not guaranteed simply by giving the employee a good salary. The job needs to be challenging enough to draw the employee interest. On the other hand, if the tasks given to the employee are too challenging, it is possible that the employee will become frustrated and burnt out. In addition, the organization environment needs to be appealing to the employees so that they can experience satisfaction at the work place.

Job empowerment: during this period of transition, employees may find themselves assigned to new tasks. The company needs to provide opportunities for skill development of the workers. Without proper skill and talent development, they are less likely to enjoy the success that comes with maneuvering the challenges of the new tasks. The result is that they are more likely to become frustrated. This index measures the employees rating of the company’s attempts to prepare them and empower them to do their own jobs.

Opportunities for advancement: in the transitioning company, there are likely to be more and more caterer advancement opportunities. Employees who feel they are stuck doing the same tasks for the rest of their lives are not likely to be productive. On the other hand, if employees understand that transitioning of Akbar and Sons will provide more opportunities for advancement, they are more likely to support the changes and work towards the successful completion of the new company objectives.

Employee commitment index: while the employees worked for Akbar and sons, they may have shown high levels of commitment. However, transition periods often bring with them periods of uncertainty where employees feel they are no longer secure. In such a case, they are less likely to continue being highly committed to the new company’s objectives.

Human Resource Cost Matrix

(Dessler 2000) states that the one way to gauge the true productivity of a company is to compare the costs of human resource and the average profits gained in the same period. This produces an index which measures the average production cost of an employee for every product. This matrix can help gauge where costs are too much and need to be reduced or where employees are given more difficult tasks and need to be compensated in a likewise manner. The following indexes can be used to support this matrix:

Revenue per employee: in this case, the company measures the total revenue, and calculates the average revenue per employee. In order to enjoy significant profits, the average revenue per employee needs to be high. When revenues are low, there might be problems in terms of the employees’ average productivity or the cost of the human resource department is high. Considering that Akbar and sons is a small company, the most likely problem to be encountered is decreased productivity. Managers therefore need to come up with ways with which they can increase the productivity of the company employees and steer them to work harder for higher revenue.

Profits per employee: this index measures how much profit can be accrued to each individual employee. There are less chances of incurring loss, if all employees begin to work hard towards ensuring the company enjoys significant growth and profits during the period of transition. Each employee needs to accrue sufficient profit to warrant the salary and other costs and investments of the company towards them.

Average days absent: according to (Askegren 2005) during the period of transition, employees are more likely to take days off increasing the average absenteeism rate. This means that productivity also decreases significantly as employees are not committed to the company objectives. Measures to curb absenteeism need to be put in place to ensure higher chances of success in the period of transition. Therefore managers can compare absenteeism during the Akbar and Sons reign and the new company period to gauge the difference and find possible solutions.

ISSUES TO BE ADDRESSED

Generating a diverse workforce: essentially, it is important for the company to enjoy a diverse workforce in terms of employees for different cultures, religions, gender and race. This means that the company must set out to specifically search for qualified employed who add to their diversity in the workforce. Previously Akbar and sons had relied on employees from within their geographical area, significantly decreasing the diversity of the workforce. A diverse workforce almost always translates to a more interesting and adventurous work place. In addition, it often means that the company will draw out skills and talents that are as a diverse as the employees. The results are almost always an increase in the rate of productivity. This may mean that managers need to take in the demographic information of all employees in order to determine where there is need for increased diversity, such as a specific gender or even employees from other geographical areas.

Training and compliance: the biggest issue that many Human resource managers face in this industry is failure of employees to adequately complete their certification registrations. Since the company relies on these certifications to ensure productivity, it is important for the managers to take the responsibility of ensuring that employees are adequately compliant. Furthermore, the new company shall include new changes, new responsibilities and therefore new duties; there maybe need to engage employees in training to ensure they are adequately prepared to take on the new responsibilities. (Mathis and Jackson 2003) conclude that majority of the companies are not interested in investing towards training of the employee simply because they view the same as a benefit to the employee. What they fail to recognize is that training means that the employee is more productive because they have the necessary skills to do the job and more confident in their assignments.

Retention: some employees identified greatly with the former Akbar and Sons. The new company therefore may led to increased flow of employees. Commonly employees are most likely to resign, take up early retirement or simple leave the company with little if any notice at all. The problem is that, while this opens an opportunity to recruit new talent that is most suited to the new company it also can be quite costly to the company. New employees will need to be inducted to the job, given orientation and the process of recruitment by itself is also quite costly. There is need for managers in the new company to find the necessary balance between proper compensation, job satisfaction and incentives which allow them to enjoy the experience and skills of the current employees. The human resource department needs to find the right balance between all these factors for each and every employee within the company in order to ensure that company objectives are not compromised. Failure to do this, means a high turnover for the company which could indeed become too costly and affect the productivity rate.

PROPOSED SOLUTIONS

Creating Workplace Diversity

Recruiting strategy: (Noe 2006) states that whereas many companies are working towards an improved workplace diversity, they often fail because they have not planned or set up strategies that encourage work place diversity. Workplace diversity does not appear magical but actually requires some sort of planning and recruitment that is strategic. This may mean the company investing in attracting employees from the underrepresented sections of the population. Instead of waiting for the right employee to come along, research is put in place on methods and ways to attract the right employee with the right skills and who enriches the workplace environment.

Creating partnerships: local recruitment agencies are the best and most ideal way for a company to get a diverse workforce. The local agencies are often aware of the most skilled and most suitable employees who will add to the company diversity. Akbar and Sons has been in operation locally, therefore recruitment agencies are aware of who will best fit within the organization. Local agencies are also often in touch with institutions such as colleges and universities and can therefore add to the organization diversity within a short period.

Relationship between diversity, social justice and ethics

Diversity allows the organization to enjoy a variety of talents, skills and culture which in turn enrich the working environment improving performance and production. However, as the organization consciously engages in improving the diversity of the workforce, a anew phenomenon comes across and this is social justice. (Dessler 2000) defines social justice as the equality of treatment of people who are different in gender, race and other cultural aspects. Majority of organizations have gotten into legal trouble simply because they have ignored the importance of equal treatment. Akbar and Sons is set in a highly explosive and tentatively trouble some ground. Workers in the organization not only need to experience differences but also there is need to feel that they are being treated equally.

Social justice and diversity policies count for a large portion of the ethical problems. Several aspects of social justice and ethics need to be addressed to ensure success in diversity:

• Equality of respect: all employees need to feel that they are recognized and respected for their variety of ideas.
• Equality of opportunity: to engage in various activities, to access resources within the company and to compete effectively for exciting opportunities.
• Equality in payment and bonuses; this is often considered the most conscientious issue in social justice. With a diverse workforce, all members need to feel they are equally rewarded for their work and no one enjoys distinct advantage or disadvantage however slight in terms of payment as this would also fall under the category of being unethical.

Power and politics

Power within an organization can be negatively influenced into politics. This is whereby; the managers use their power to determine activities that would lead to an outcome favorable for them. In the new organization for example, majority of the managers are likely to feel threatened by the new upsurge of power in the company. As such there is likelihood that they will engage in various activities which are not geared towards success of the organization but rather towards pushing personal agenda. In such a case, production is likely to decrease significantly while at the same time tearing the work force into factions.

Limiting effects of power and politics

• Open communication; each step of change should be followed with open and clear communication. Poor communication provides a loophole through which managers and others in power can misdirect the employees.
• Evaluate the performance strategy; the performance measurement and reward system should be clear so that employees are more concerned with increasing production and performance rather than engaging in politics.
• Introduce clear rules: during the process of change, the rules should be made clear with regard to distribution of resources and meeting of task expectations. When employees are aware of what is expected of them, they are less likely to engage in politics.

Training and Compliance

Before investing in any form of training and compliance measures, the company needs to take stock of the current employee skills as well as career advancements and projections. (Pugh and Mayle 2009) state that many companies go wrong when it comes to training simply because they do not align their goals with those of the employees. The result is that they may take an employee for training, invest in them gaining skills which then are shelved as the employee seeks out other career advancement opportunities.

Strategies For The Company

Advancing Training and Compliance

Create and execute compliance: this means having records of all compliance measures which employees must meet in order to remain productive. The strategies set forth may require reminding employees of compliance measures, giving time for the employees to engage and find the materials necessary to remain compliant and at the same time providing the necessary resources for employees to track their own compliance. It may also be wise to partner with the compliance organizations in order to have the necessary information for tracking employee compliance. Susah organizations help the company to keep track of the necessary compliance measures, maintain a high compliance rate and keep employees well informed of their own compliance track record.

Communicating about opportunities for training: opportunities for training often arise when the company lacks specific employees who are qualified to complete certain tasks. In this case, the communication can be set out to the employees for those who may be willing to engage in training and advance their own skills. Employees who feel that the training opportunity is in line with their own developmental goals will come in seeking to advance their own careers. Such training opportunities need to be in partnership with the organization and the employee. Each gives a little in order to gain from the same opportunity. In addition, the company can partner with the training institutions to offer training opportunities at subsidized costs to the employees.

Resolving the retention problem

Match employee pay with work demand: 60% of employees who leave any company, do so because they have been offered better pay or they are dissatisfied with their current salary (Garber 2008). A possible solution to employee retention would therefore be to offer a competitive salary. However, it is important to note that the company cannot rely on salary alone to maintain employees. Competitors are likely to also offer better salary opportunities to the employees and therefore, although this is a first step I cannot be supported on its own.

Bonuses and incentives: these are often dependent on the resources that the new company has to invest. Incentives such as performance allowance and health benefits are likely to make the new company even more attractive. It may mean that the company needs to invest in bonuses and incentives that are either higher, parallel or better than those offered previously by Akbar and sons. The difference needs to be clear in order for employees to see the significant change in the company. This change is what leads to the desire to stay and remain with the company.

Opportunities for growth: most employees stay within a company not because they are paid much better, or because they have increased benefits but simply because the company offers opportunities for career advancement. Akbar and Sons was a small company with limited opportunities for growth, however, the much larger BP Company is more likely to provide several avenues for career advancement. The management needs to ensure that employees clearly see and are aware of the opportunities. It is also important to ensure that employees can realistically meet the requirements for career advancement without becoming frustrated.

Virtual teams

Currently, the Akbar and Sons Company is working closely with the BP Company to create a participatory process through which the virtual teams can be used to develop idealistic leaders for the new company. The lack of face to face communication has made it difficult for the company to build trust among the employees. The lack of trust during the period of change provides the most difficult challenge. Progress is difficult when both teams are holding each other in suspicion. It has become vital that all teams work together, the BP team has established an ideal communication channel that will allow members to remain open, to communicate effectively and therefore and therefore develop a bond of trust.

Through the collaboration of the teams, managers can track progress and ensure deadlines which have been previously difficult to meet for the virtual teams are not only met but are in fact maintained. This means that tasks assigned to the teams are finished on time, and within budget.

CONCLUSION

As Akbar and Sons is being acquired by BP, a period of transition will ensue. Change in every organization is inevitable. Majority of the organizations are often prepared to deal with various forms of change. However, transition into a different organization often leads to much more changes in the organization than has been prepared for. The following are some of the issues to be addressed in the process of transitioning from Akbar and Sons to BP;

Staffing: the rapid growth that will be experienced by the company, the company may need to recruit more staff. This means structuring ways in which to find the rapidly vacant positions that will be coming up. In addition, the human resource will need to invest in ways through which talent can be sought that will suitably fit into the company. In addition to recruitment strategies, the company needs to come up with new job descriptions. The tasks within the company will be altered, therefore new job descriptions will be ideal to ensure that employees are aware of what is expected of them. Furthermore, some jobs will have to be done away with, to make space for new and upcoming changes within the new company.

Insecurity: for employees of Akbar and Sons, the acquisition brings problems of fear and insecurity. Employees may feel that the transition means that they are no longer secure in their positions and place of employment. Akbar and Sons is a small company being acquired by a much larger company, creating apprehension among the employees over the probability of adapting to the various changes in the organization. This may require the company to undertake public relations in order to alleviate the fears of employees. Drucker (1995) asserts that Fear often results in poor productivity since employees are more focused on securing their employment or finding employment that is secure in another area rather than meeting the objectives of the company. Campaigns will be vita in ensuring that employees feel more secure. In fact for the first few months Mr. Akbar and his son could report to the company as part of the campaign to alleviate ay fears of the employees.

At this time of transition, it is important that communication channels are kept open. (Kotter 1996) cites that much of the conflict, problems and challenges that arise during the period of transition are due to poor communication. All people within the organization need to be kept aware of what is happening and how they play into ensuring the transition process is a success. Employees need to be encouraged to bring forth their feedback to the senior management. Through this feedback, the management can gauge how well the employees are responding to change and I indeed any adjustments need to be made. This means that steps need to be taken to ensure that communication, written or otherwise plays into every step of the process of transition. Mr. Akbar and his management and the teams coming from BP need to work together to ensure that the workers are kept in the loop. This ensures that employees are aware of what to expect during each step, prepared for all the changes and therefore more cooperative in the process of transitioning from one company to another.

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