Week 2: Health assessment
2. What will be the impact of any cultural shifts required by this investment on the company?
External expansion can have unexpected financial consequences due to lack diligence. Operational inefficiencies due to integrating new business into existing businesses and compliance concerns related to taxation or regulatory policies are also possible. However, there are many benefits to external expansion, including increased market share and access to new markets, customer bases and cost savings, greater management capability or better capacity, as well as diversification and price optimization through economies of scale.
It is crucial to assess how cultural adjustments will be made when evaluating an external expansion. It is important to understand how the different departments will work in collaboration if there are employees coming from two companies. This is crucial for the success of integration. It’s important that you identify ways to improve communication skills and build trust between departments. Last but not least, having measures in place for successfully recognizing each team’s contributions towards achieving shared goals should also be taken into account when addressing this issue.