Synergy implies a situation where the combined firm is more valuable than the sum of the individual combining firms. It is defined as ‘two plus two equal to five’ (2+2>4) phenomenon. Synergy refers to benefits other than those related to economies of scale. Operating economies are one form of synergy benefits. But apart from operating economies, synergy may also arise from enhanced managerial capabilities, creativity, innovativeness, R&D and market coverage capacity due to the complementarily of resources and skills and a widened horizon of opportunities. An under valued firm will be a target for acquisition by other firms. However, the fundamental motive for the acquiring firm to takeover a target firm may be the desire to increase the wealth of the shareholders of the acquiring firm. This is possible only if the value of the new firm is expected to be more than the sum of individual value of the Continue reading
Management Concepts
Is Management is an Art or a Science?
Is management characterized as an art, as a science or both? In order to investigate the nature of Management, it would be useful firstly to define it. According to Drucker “Management is about human beings. Its task is to make people capable of joint performance, to make their strengths effective and their weaknesses irrelevant. This is what organization is all about, and this is the reason why management is the critical, determining factor”. Nowadays, practically everyone works for a managed institution, large or not, business or not. Our living actually depends on management. The ability we have to contribute to society, depends firstly on the way, the institute we work for, is managed and furthermore on our own abilities, devotion and effort. For years now, there has been a great debate on whether management can be characterized as a science or as an art. Management as an Art Art is Continue reading
Amalgamation – Definition and Types
Amalgamation is an arrangement or reconstruction. It is a legal process by which two or more companies are to be absorbed or blended with another. As a result, the amalgamating company loses its existence and its shareholders become shareholders of new company or the amalgamated company. In case of amalgamation a new company may came into existence or an old company may survive while amalgamating company may lose its existence. According to Halsbury’s law of England amalgamation is the blending of two or more existing companies into one undertaking, the shareholder of each blending companies becoming substantially the shareholders of company which will carry on blended undertaking. There may be amalgamation by transfer of one or more undertaking to a new company or transfer of one or more undertaking to an existing company. Amalgamation signifies the transfers of all are some part of assets and liabilities of one or more Continue reading
Compare and Contrast Maslow’s Theory of Needs with Vroom’s Expectancy Theory
Motivation is an intangible human asset which acts as a driver that pushes humans to be willing to perform certain actions. In just about everything we do there is something that moves us to perform the action which involves some motivation allowing us to perform tasks or actions which produces some type of personal benefit as a result. The general theory would be that, the greater the personal gain in performing the task for the individual, the more motivated they are to try at the task to achieve the best outcome. Motivation is usually stimulated by a want where there is a gain to be had as a result of performing a certain task. A person is a wanting being – he always wants, and he wants more. Therefore if there is nothing that an individual wants, there would be no need for them to perform a certain task as Continue reading
Introduction of Market-Based Management
Market-Based Management is found on the principles that cause societies to become wealthy instead of mired in poverty. It sees the business as a small society with exceptional features requiring variation of the education drawn from society at large. Through this variation an organisation could build MBM structure and ever-evolving mental models. Market-Based Management is a holistic approach to organization that incorporates theory and practice and organizes businesses to deal effectively with the challenges of change and growth. It also draws on the training learned from the failures and successes of individuals to attain prosperity, peace and organisational progress. Thus, it involves the study of the history of economies, politics, societies, cultures, governments, businesses, conflicts, science, non-profits and technology. Market-Based Management is the exceptional management tactic developed and executed by Koch Industries, Inc. It is a company philosophy that is embedded in the science of human action and functional through Continue reading
Top 13 Reasons Why Organizational Change Fails
Now a day’s change in the organisations is really norm because at the moment organisations are facing many factors which are influenced by both the external and internal environment. As we can see that world is changing at very rapid speed so it is very important for any organisation to adapt the changes to survive in this competitive market. It is also very vital for any organisation to fulfill the needs of their customers to sustain in modern world so for that particular reason they have to take some bold steps by implementing the changes in their business models this can be according to the current trend in the market, innovations in technology and customers demands. For the successful business it is very important to make changes because it is a demand of time. Organizational change is the process of transformation. It may be cause success or failure. Change becomes Continue reading