Journal of Management and Marketing Research - Volume 2
The Transitions of Managers into Newly Acquired Organizations
Donnie Smith
California State University, Fullertbn
Abstract
There is a high failure rate of managers who fail in the transition process from small, loosely structured family owned business to highly structured larger organizations. This article addresses why individuals become managers then examines the transition of managers from smaller organizations into larger organizations due to the acquisition of their previous organization. The acquiring organization frequently has higher expectations, different cultures and greater accountability. This often limits the successful transition for the newly acquired manager. Other factors impacting successful transitioning of the newly acquired managers are: resistance to change, lack of team based management strategies, toxic management behavior, unwillingness to embrace employee empowerment and lack of leadership training and skills.
Finally, this article examines the attributes of mangers who manage to make the transition successfully. Keywords. Managers Mergers & Acquisitions, Toxic Managers
Introduction
As organizations grow, changes in the leadership needs oij the organization require different skills to navigate through various phases of growth. Much of the growth in organizations comes from mergers & acquisitions. As the trend cdntinues over the last several years more organizations are being acquired, this acquisition is especially painful when large corporations acquire small or medium companies. As smaller organizations tend to have less formal structure, which often makes them more vulnerable to larger organizations with, rigid infrastructures it is very difficult for them to transition into the lailger acquiring organization. In fact according to Nguyen and Kleiner (2003) most acquisitions fJil due to the lack of integration.
According to Roberts (2002) only 43% of acquired organizations achieve the expected success through the act of acquisitions. Roberts, states the major ¿bstacles to successful acquisitions are the following:
1. Poor financial performance 64%
2. Loss of productivity 62%
3. Cultural differences 56%
4. Turnover of key talent 53%
5. Clash of management between two organizations
6. Ineffective integration or transition of the newly acquired organization
Corporate acquisitions are frequently undertaken with an emphasis on getting the deal done. Therefore, the integration issues that might arise afterwardsl are often overlooked or ignored. Inadaptability of employees and managers of the acquired business is one of the primary reasons that corporate acquisitions fail to meet the expectations of the parent organization (Johnson, H. 2002). Members of the newly acquired company's management team struggle with the new direction, structure, expectations, culture and accountability forced upon
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Journal of Management and Marketing Research - Volume 2
them; however it is the ability of these managers to make the acquisition successful.
Why do individuals become managers
Managers are expected to administer activities for corporations, every day these managers solve difficult problem, turn organizations around, and achieve astonishing performances (Daft, 2007). However, when I asked an employee applying for a recently open management position within the company "why did he want to become a manager"? His answer was, to have a nice office, make more money, not work so hard, and tell other employees what to do. While I was dismayed by his response I understand this might be a common view of why people want to be managers. Many employees pursue careers in management because of encouragement from parents. In an effort to have better lives many parents encourage their children to earn a college degree and become a manager. As young adults, children see parents working hard as auto mechanics,
