Wellcome Trust, which owned forty percent of Wellcome company shares, originally stated that they would not sell their shares without discussing the decision with management prior to the sale. The Trust then changed its stance and allowed Glaxo to acquire the shares in support of a hostile takeover. There were no notifications to management, and no integration or merger plan was presented before the announcement. In previous chapters we learned that mergers and acquisitions are very stressful on employees. “Research indicates that at least two hours of productive work per employee per man-day is lost during mergers and acquisitions activity in the organizations.” (Brahma and Srivastava, pg 10). The workforce went from being secure in their jobs and assured that they would be notified of any merger prior to the event now felt betrayed, stressed, and unsure of their futures. The near future now holds a possibility of monetary losses associated with workforce turmoil, and less work productivity.
What They Should Have Done
Wellcome Trust should have notified management of their intention to support the takeover bid by Glaxo. The opportunity for the companies to participate in some sort of opportunity-based change might have given he both companies time to anticipate some of the problems associated with the takeover, allowed for time to devise an integration plan, and maintain the trust between Wellcome and their workforce. Immediately following the announcement of the acquisition, management should have been notified of the need for an integration plan with the parameters and vision set forth in a formal fashion.
Ofra Sherman’s Predicament, and Her Plan and Her Future
Ofra Sherman finds herself in a struggle between multiple companies and personalities. Ofra is a manager for Wellcome Israel, but she and her team make up the pharmaceutical and diagnostics division of the Israeli owned company Promedico. To complicate matters, an official agreement was never negotiated between Wellcome and Promedico outlining terms and or conditions of their business relationship. (Jick and Peiperl, 2011). Additionally Ofra’s general manager made threats eluding to a rough transition, and her boss in Greece angrily told her to do nothing until his express permission was given. Feeling betrayed by two companies, an unsure future and caught between two bosses jockeying for supremacy, she is experiencing a great deal of stress. But she isn’t alone.
Ofra’s Wellcome team is experiencing the same anxieties. She is fact finding with co-workers and superiors, and feels she cannot confide in them or her subordinates. I think that she is paralyzed and searching for answers trying to make sense of the situation. “Sense-making refers to the process whereby organizational members translate an organizational event and construct a meaningful explanation.” (Lotz and Donald, pg 2). Instead of being reactive in this situation I would be proactive and make some tough decisions. I would press Wellcome for answers, and look at the prospect of taking my team’s talent elsewhere. I would create at least three viable courses of action and discuss them with the team. After getting their input we would then proceed with the preferred course of action.
An Evaluation of Ofra’s Actions
I have experienced and understand the difficulties presented in this case. Mrs. Sherman’s inactivity is unsettling in my opinion. In her place, my primary goal would have been to save my job or find employment at another company. She may have been loyal to the company and her team, but her actions leave me thinking that if she loses her job she won’t have a plan. She may be in the second stage of the transition stages called the neutral zone. In this period she would feel adrift and confused and grow increasingly unproductive. (Jick and Peiperl, 2011). I find her actions borderline irresponsible and detrimental to the team that she supervises.
Brahma S, Srivastava K. Communication, Executive Retention, and Employee Stress as Predictors of Acquisition Performance: An Empirical
Evidence. ICFAI Journal of Mergers & Acquisitions [serial online]. December 2007;4(4):7-26. Available from: Business Source Complete, Ipswich, MA. Accessed April 14, 2016
Jick, T.D., & Peiperl, M.A. (2011). Managing Change: Cases and Concepts (3rd ed.). New York,
Lotz T, Donald F. Stress and communication across job levels after an acquisition. South African Journal Of Business Management [serial online].
March 2006;37(1):1-8. Available from: Business Source Complete, Ipswich, MA. Accessed April 14, 2016
RESPOND TO GARLAND