Case Study 5 : HP and Compaq Combined 1, Why did HP’s management want to acquire Compaq? As we know, The HP and Compaq are two very large high-technology companies, They want merger together then have more power to leading technology company in the word, And also , they established cultures in the context of a highly dynamic competitive environment. But the merger would produce one very large iceberg; perhaps big enough to sink competitors, or break up under the stress of internal and external forces. 2,Describe HP’s acquisition integration planning process.
How effective was it? Why or why not? In order to as smoothly as possible arrived successful in merger, they to formulate detailed about merger plan. There are four critical process that capture the strategic dynamics of an acquisition integration process. The first process- formulating the integration logic and performance goals. This process involves the boards of directors, top managements, and consultants of the two companies. It is important to distinguish two aspects of this process. The second process- cresting the integration plan.This process involves deciding on the new executive team and the basic organization structure of the combined companies.
Planning activities related to the multiyear strategic initiatives needed to develop a new culture. The vast majority of managers and employees of both companies only have to think about delivering current business results and creating the blueprint for executing the operational and strategic integration process. The third process- executing operational integration, This process is very hard for everyone that is they have large number of layoffs, the remaining levels of management are selected. nd this process will spend at least 6 and 12 months. At the same tim , longer-term integration tasks are started – such as those related to information technology, organizational effectiveness, and corporate culture. The forth process – executing strategic integration. This process involves both completing the longer-term operational integration task and the multi-year strategic initiatives necessary to get ahead of the competitive dynamics envisioned.
,Describe HP’s actual execution of the acquisition integration. How well was it executed? Why or why not? Plan always is plan, Hp’s actual execution will have many changes in real process. The distinguishes between four key processes and feedback loops helps explain the strategic dynamics of the HP-Compaq merger. We must pay attention about a key unresolved issues in progress. The process of formulating the integration logic and performance goals generally well carried out.The pre-clearance process of establishing the integration planning approach and the integration tools developed for that purpose were also first rate. The operation integration process do not have big change in actual execution.
The process similarly was generally executed quite well and beat the short-term goals set for the merger. On another hand , we found that the feedback loop between the operational integration process and the process of formulating the integration logic and the performance goals could have been stronger.We also found that the strategic integration process was not clearly recognized as a distinct one by top management, which resulted in an even weaker feedback loop to the integration logic and longer-team performance goals. In conclusion , The role of feedback loops in managing both the strategic dynamics of acquisition integration and the role of the integration-planning team offers useful guidance for the top managements and boards of directors on other companies contemplating major acquisitions. ,Describe some of the integration tools that each be developed. How useful could they be full other companies integrating acquisitions? Why or why not? The workings of the Clean Team: The concept of a “Clean Team” was introduces in previous mergers to make it possible to comply with antitrust laws while simultaneously starting the integration planning effort. Employees joining the Clean Room were among the best and brightest of both companies and ran the risk of not being able to go back to their prior jobs in case the merger would not does.
Adopt- and-GO: Adopt- and-GO improved the focus of 99% of the combined HP-Compaq employees who worked outside of the Clean Team. The Adopt- and-GO process stopped the politicking, it allowed for speed of execution and that was the pivotal part of the new company’s ability to accelerate the savings. Launch-and Learn: There were significant cultural differences between HP and Compaq and the integration required a strong, multi-year focus on establishing the new culture. Putting the Moose on the Table:The Putting the Moose on the Table means that getting teams drawn from two very different companies to work together to do a hard job raised delicate and complex challenges. Fast Start and Fast Value: To help speed the cultural integration of the two companies, HP included a Cultural integration Team within the overall Clean Team. Meeting with the Steering Committee: This tool while the Clean Team operated in metaphorically clean rooms apart from the day-to-day distractions of operating a company, they were closely linked to the Steering Committee which was a subset of the new company’s executive committee.