The impact of company acquisition and rebranding on the workforce in a Kwazulu-Natal manufacturing plant, SA.
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Date
2016
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Abstract
ABSTRACT
Problem Acquisitions, mergers and the eventual rebranding of companies has become a common practice in the business world today. The motivation for this practice ranges from business diversification, to strategic growth, to the elimination of competitors. The reasons for the process vary, but the effect on the workforce is largely the same. Pre, during and post-merger, employees tend to feel high levels of anxiety, stress, distrust and alienation. These negative effects on the workforce result in huge losses in employee productivity, company output and even the loss of key personnel.
Purpose This research study focused on a recent acquisition, merger and rebranding that occurred at a manufacturing plant in KwaZulu Natal, South Africa. It was noted that staff experienced the typical emotions associated with the process. An objective of the study was to determine the factors that motivated and excited staff the most about the merger. The second objective was to determine what factors demotivated and concerned staff the most. Thirdly, it was investigated whether lower salary earners were more or less resistant to the changes than higher salary earners. The fourth objective of this research was to determine how the acquisition and merger process can be improved from the perspective of the workforce.
Design and Methodology Staff at the plant were surveyed using a structured questionnaire. The research instrument consisted of quantitative type questions that staff answered on a Likert Scale, and a qualitative type question where staff could input their feelings, views and opinions. The data retrieved was analysed in great detail and provided significant insight into the mind-sets of staff during the process. Data was described descriptively and inferentially and has been tied to relevant literature and current statistical data.
Findings The factor that caused the greatest motivation and excitement among staff was the possibility of increased job security after the acquisition, merger and rebranding. The greatest level of demotivation and concern/worry was caused by potentially reduced job security after the process. It was found that in terms of motivation and excitement levels, there was no significant difference in attitude between lower earners and higher earning staff. It was qualitatively found that an improved benefit scheme would have most greatly improved the overall experience of staff.
Conclusions and Value This study investigated the effect that an acquisition, merger and rebranding has on a workforce. The study found that to optimize motivation and excitement levels, it is recommended that management open communication lines and engage in collaborative decision making with staff. To minimize demotivation and concern/worry, providing clarity surrounding the job security of staff members should be a priority. To improve the process, it was found that the inclusion of a benefit scheme, specifically a retirement benefit had the greatest effect. The findings from this study provided insight into what can be done to improve the acquisition, merger and rebranding process. Application of the recommendations may increase the success rates of mergers and make the process far more efficient as staff will be more motivated and positive towards it.
Description
Master’s Degree. University of KwaZulu-Natal, Durban.