Mergers and acquisitions are a common happening in business and the corporate world. We see this happening all round us today, among start-ups as well as major long-standing companies. Within this downsizing, and "golden handshakes," to get companies to be lean, thin and mean - and profitable - is also commonplace and often. The challenges of this are generally wide ranging and affect people (employees) structures, HR, corporate culture and integration, along with finances.
One such real-life example, and discussed in this case-study, was of Welcon Limited, a large pharmaceutical company, in Mumbai, downsizing considerable manpower in Mentil Pharmaceuticals Ltd., acquired from of a large business group that was systematically exiting and divesting in its non-core businesses and companies - consumer products and pharmaceutical, among others.
Welcon Limited set itself a task of reducing Mentil's manpower by 400 employees in a short period of 3 months! A task which would greatly impact the employee structure, their integration, morale and motivation in the activities, as well as overall culture, just as much as its overall business growth and profitability objectives, in the Indian pharma industry.
The case study explores the circumstances in which a special Voluntary Retirement Scheme (VRS), for the erstwhile Mentil employees was conceived, planned and implemented for the acquired smaller and loss making pharma company, and in order to integrate the employees of the merged entity to be more efficient, productive and profitable.
The case study explains how the VRS was met with resistance from the staff Union, and a large section of the Mentil workers, and the strategy utilised by Management to overcome a crisis which had potential for blowing into a negative situation of significant proportions.
The case study discusses and provides details of the VRS at Welcon, along with information on how it was designed, communicated and sold to the employees by a Task Force, after witnessing some resistance and agitation, and then finally the desired positive result, and peaceful outcome.
Besides the discussion on the VRS, the case study states the ultimate outcome in respect of the company's hard-nosed HR and IR stand, communications and PR strategy, with a win-win situation for the Management and all employees, within the company's objective of bringing about integration and motivation, and "feel-good" factor in the end.
* FLAME CASE CONFERENCE 2015
- To handle a sensitive and crucial crisis in a company’s survival and growth involving its employees inherited, and the impact on the existing employees - morale and integration issues
- To analyze, plan, and devise a real and effective strategy in managing employee productivity and general profitability in a take-over and acquisition situation -which is unusual and uncommon in all respects of managing a company and business
- To have a broad overview and handle of key financial and legal aspects in such a situation affecting management and employees
This Case Pack Includes: - Abstract- Case Study- Teaching Note (**ONLY for Academicians)