Project organization in mergers and acquisitions – introduction

The successful completion of a project is partially dependent on how well various aspects have been organized. The organizing function, for example, determines the activities to be performed, the resources with which to perform such tasks and the positions that are involved in such tasks (Verma, 1995). The orderly, efficient and effective utilization of all the available resources in meeting the objectives the project is designed to achieve is vital to an effective organizing function. Thus the function requires a well thought out structure that defines the roles and interaction between project teams and among individual members in the team (Verma, 1995). Mergers and acquisitions (M & A) are an example of a situation where the organizing function should be prudently applied. This is because in most cases such projects are evidenced to deviate from the expected results of the initiators (Datta, 2002). These form a basic means by which a company tries to increase revenues either for financial reasons or lately for an operational leap.

Historically mergers and acquisitions were mainly financial transactions that strived to give the power over the undervalued assets of one entity to another – the acquirer but the current trends in mergers differ from these historical aspects in a number of aspects: reasons for the mergers, risks involved in the merger, targets for the mergers, rewards following the merger, the mandate and the nature of the market characterizing the merger (Galpin, & Herndon, 2007).  An example of these differences pertaining to the risks inherent in the merger is that while historically mergers were associated with overleveraging current mergers are associated with integration failure thus leading to unsuccessful takeovers (Galpin, & Herndon, 2007). Probably the environment of change characterized by pressure, uncertainty, stress, skepticism, pace and the enormous volume of the hard decisions that are part of the merger and acquisition processes that could overwhelm even a well laid out organization are the reasons that lead to such failures. But how should successful M & A be carried out as pertains to the organizing function? This paper addresses the issue of project organization as relates to M & A’s projects. The steps that form the basis for the organizing process will be discussed in light of M & A’s. go to steps.

 

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