Organization cultural element is a critical issue in mergers and acquisitions. Over the years, mergers and acquisitions have become a global spectacle and a popular strategic choice for the growth and expansion of companies. Organizational culture emphases on the manner in which corporate partakers’ experience and make sense of organizations.
Amazon Acquisition of Whole Foods and Methods of Managing Culture
Amazon, an e-commerce giant, acquired Whole Foods in 2017 in a bid to help increase its shares of US grocery sales a market that was dominated by traditional supermarkets such as Wal-Mart. Through the acquisition of Whole Food, Amazon will need to find a way of handling and managing culture (Taylor, 2017). Companies may use different ways such as integration, assimilation, deculturation, and separation in a bid to resolve conflict as adapting to their cultures following an acquisition or merger (Wheelen et al., 2018).
Integration and separation are the ideal methods of managing culture for Amazon and Whole food. Through integration, both companies can build on equal trust with each other’s cultural strengths and weaknesses thus creating a culture that is best for both companies. In integration, there is the minimal imposition of a change of culture on any of the company hence both cultures are preserved in the resulting culture.
Amazon is known to have obsessively a culture that is customer-centric while Whole Foods has always assumed the idea of conscious capitalism with a well-balanced set of commitment to customers, investors, employees, and communities. Whole foods have a business culture that honors inclusive decision making. Each Whole Foods store is inspired by the community that surrounds it hence a localized culture is core to what it is as a brand (Taylor, 2017). One of the best ways to slowly merge the Amazon and Whole foods cultures is by creating employees and customers’ stories. Amazon may exhibit who they are and what they are passionate about in their business. Separation would also be an ideal method whereby the two companies may remain distinct entities with reduced exchanges of culture or the practices of the organization (Chmielecki and Sulkowski, 2017).
Goal Displacement and Possible Remedy to Prevent it
Goal displacement refers to a shift in a company’s goals in the course of time (Wheelen et al., 2018). Goal displacement may be behavior substitution or sub-optimization. Behavior substitution involves replacing activities which do not result in the accomplishment of goals with activities leading to achievement of goals due to rewarding incorrect activities. For example, Sear Company introduced a percentage commission to employees for every repair bill leading to a change in employees’ behavior to get the reward further resulting to overbilling of clients. Sub-optimization, on the other hand, is the occurrence of a unit adjusting goal accomplishment to the disadvantage of the entire organization. For example, Sear Company divided into 30 units, with each of them comprising their board of directors and executives to enhance accountability and visibility but instead, they engaged in sabotage and competition tying success to single divisions at the expense of the rest of the company (Wheelen et al., 2018).
One of the ways to prevent goal displacement is designing controls that follow strategy, therefore, guaranteeing utilization of the proper approach for the achievement of the objectives. Conducting performance audits helps to identify fabrications or even lack of basis for the actions taken. It is crucial for organizations to set short term and long term goals that are specific, tangible and focused on limiting goal displacement and avoiding vague goals, which enhances goal displacement. The objectives and goals set should be quantifiable, and the organizations should ensure that information systems provide not only timely but also valid information (Granito, 2016).
In conclusion, cultures are essential aspects of organizational growth and are an integral part of mergers and acquisitions. Goal displacement, on the other hand, may happen at various levels and for many reasons but can be prevented.
References
Chmielecki, M. &. (2017). Organzational Cultural in Mergers and Acquisitions. Journal of Intercultural Management, 8(4).
Granito, F. (2016). Goal. Institute for Digital Transformation. Retrieved from: http://www.institutefordigitaltransformation.org/beware-of-goal-displacement-ensuring-value-in-the-digital-age/
Taylor, B. (2017). Amazon, Whole Foods, and the Future of the (Old) New Economy. Harvard Business Review. Retrieved from: https://hbr.org/2017/06/amazon-whole-foods-and-the-future-of-the-old-new-economy
Wheelen, T. L., Hunger J. D., Hoffman A. N., Banford C. E. (2018). Strategic management and business policy. Globalization, innovation and sustainability
15th ed. London: Pearson
