Transorganizational Change
22-2
Transorganizational Rationale
22-3
Transorganizational Systems
22-4
Mergers and Acquisitions
Merger - the integration of two previously
independent organizations into a completely new
organization
Acquisition - the purchase of one organization by
another for integration into the acquiring
organization.
Distinct from transorganizational systems, such as
alliances and networks, because at least one of
the organizations ceases to exist.
22-5
Merger and Acquisition Rationale
Diversification
Vertical integration
Gaining access to global markets,
technology, or other resources
Achieving operational efficiencies, improved
innovation, or resource sharing
22-6
Merger and Acquisition
Application Stages
Pre-combination Phase
The organization must identify a candidate
organization, work with it to gather information
about each other, and plan the implementation and
integration activities
Legal Combination Phase
The two organizations settle on the terms of the
deal, gain approval from regulatory agencies and
shareholders, and file appropriate legal documents
Operational Combination Phase
Implementing the operational, technical and cultural
integration activities
22-7
Strategic Alliances
When two organizations formally agree to
pursue a set of goals
There is sharing of resources, intellectual
property, people, capital, technology,
capabilities or physical assets
Common alliances are licensing agreements,
franchises, long-term contracts, and joint
ventures
22-8
Alliance Intervention
Application Stages
Alliance Strategy Formulation
Clarify the business strategy and why an alliance is needed
Partner Selection
Leverage similarities and differences to create competitive
advantage
Alliance Structuring and Start-up
Build and leverage trust in the relationship
22-9
Network Interventions
Involves three or more companies joined
together for a common purpose
Each organization in the network has goals
related to the network as well as those focused
on self-interest
Characterized by two types of change: creating
the initial network (transorganizational
development) and managing change within an
established network
22-10
Application Stages for
Transorganizational Development
Identification Convention Organization Evaluation
22-11
Managing Network Change
Rely on self-organization
22-12