Change management strategies, post-acquisition and merger, at a private wellness organisation in South Africa.

Abstract

Organisations use mergers and acquisitions as a growth strategy in the quest for market domination and sustained competitive advantage. This growth strategy is still actively employed even though global statistics reveal that eighty three percent of all mergers and acquisitions result in failure. The purpose of this study was to assess the effectiveness of the change management strategies employed by Company XXX during its 2017/2018 acquisition of Company YYY. This qualitative study utilised a phenomenological research design and the collection of data was done through semi-structured interviews. Ten line managers (Grade 12-15) participated in the study from Company XXX and Company YYY. The change management process relating to post-merger integration, communication and leadership during and postmerger was investigated using the Kotter eight step change management model as the theoretical framework. The data collected was transcripted and NVIVO was used for data analysis where the information was coded and themes were identified. Themes that emerged from the study was that the organisation did not have a formal change management strategy that addressed pre and post-merger integration processes, managers who were tasked with the integration process felt that this proved to be difficult for them as they felt disengaged from the organisation. Poor communication, a lack of structure and silo management from senior leadership increased employee disengagement. This resulted in demotivated employees, increased uncertainty relating to job security and the eventual loss of employees with critical skillsets. The study participants also provided valuable insight from a human and operations perspective on how change should be managed more effectively for the organisation to benefit meaningfully from the merger. The overarching theme was the lack of communication and silo management practices. A recommendation was for the organisation to initiate communication and maintain open communication throughout the process with evaluations done at the different stages of the integration. The establishment of a cross-functional change management team to guide the required changes was also highly recommended.