You will create a thread in response to the provided prompt for each forum. Each thread must be at least 400 words, demonstrate course-related knowledge, and integrate at least 2 peer-reviewed articles. In addition to the thread, you will reply to the threads of at least 3 classmates. Each reply must be at least 250 words and contain at least 1 citation from a peer-reviewed journal and 1 from the textbook
The case of Welcome Israel provides another opportunity to analyze individual and organizational approach to change(s) and the impact of those changes. The case provides a synopsis with Ofra Sherman and Glaxo’s situations as the change was unfolding between these two firms. As you reflect on the change in this case study, respond to the following prompts as you prepare your DB thread for this assignment:
- What did Glaxo-Welcome do? What should they have done?
- Did Ofra Sherman do the right thing? What would you have done?
- What was Ofra Sherman’s predicament? How did she get into it?
- How do you evaluate her actions as described in the case?
RESPOND TO THIS POST FROM FERGUSON
Wellcome Israel is a pharmaceutical company operating in Israel. Wellcome is being acquired by Glaxo and soon will become Wellcome-Glaxo. This appears to be a hostile bid type takeover to create a large pharmaceutical company. All employees and management were extremely surprised by the takeover and are having a hard time processing it. The main them and problem that will be noted in this post is the lack of communication, direction and vision.
Glaxo-Wellcome is on the way to becoming one of the largest pharmaceutical companies in the world. There is an apparent hostile takeover in progress that no one including Wellcome management is aware of. As with any change there are periods of uncertainty, fear, and anxiety. The main focus is a general manager Ofra Sherman and her team who works for Wellcome Israel through Promedico. This takeover was done in a manner that is very disturbing in the fact that there was no communication and very little guidance throughout the entire process.
What they should have done is really quite simple and that is communicate. As I mentioned before change is a very anxious time and can lead to stress and poor work performance for those involved. “Good communication throughout every stage of the change process is vital to keep everyone informed and motivation levels high.” (Kirke 2012) This takeover shouldn’t have been a surprise to Wellcome and they should have been upfront with employees about what was going to occur and then once the takeover by Glaxo started the communication should have ramped up. I think one of the best ways to have handled this would have been to have teams from both companies setting up meetings so there was a continuous flow of information.
Ofra Sherman in my mind was in a very tough spot once again a lack of communication between all the parties really left her between a rock and a hard spot. She has a very good relationship with her team and this uncertainty has really brought the motivation among her and her staff down. She is on the right track trying to ask the right questions and seeking guidance and trying to get the communication flowing. I would suggest that she continue to be open and honest with her staff and provide as much information as possible. “Change management is a complex process which varies according to each individual organization’s needs.” (Kirke 2012) Her ability to manage the change is going to be key in this particular situation as no one knows for sure what is going on. I don’t fault her for being hesitant because the flow of information is just not there to be able to make those good solid decisions.
I am not sure I would do anything differently then what she has done there is no solid information the way the companies are set up in Israel is already a complex situation. I would follow in her footsteps and just be open and honest with my staff and ensure that any information I received to pass on. The one thing I would need to avoid is the rumor mill as this could be very detrimental to the team at this point.
She does seem to be in an odd predicament as she decides whether to move her team to Glaxo or stick with her current company. As I mentioned earlier she is really in a tough spot as her current company does not want her to meet with them but it could be in the best interest to sell her team early as they are an extremely profitable group. She seems to be getting advice that may be hard to follow as some say she should leave Promedico and others say she should stay and wait it out. Once again the whole predicament could have been avoided with communication and a plan from both companies laying out what they intend to do instead of leaving the employees in limbo.
My evaluation is quite simply put as this Sherman is doing the best she can given the current situation which is not knowing what is going on. Sherman is not doubt a very good leader as she has worked her up in her current company and seems to be well respected by her team. She may very well be on her way to leading her team with the new company Glaxo. If that is the case she must be prepared to sell that change. “Mental toughness is imperative when selling change because you are almost always dealing with some form of crisis along the way.” (Llopis 2012) Hopefully the information will flow downward to Sherman so she is better able to manage the change as opposed to be in limbo. I have no doubt once the information gets to Sherman with the leadership abilities she has she will foster the change and her team will be the better for it.
Jick, T., & Peiperl, M. (2011). Managing Change: Cases and Concepts. New York, NY: McGraw Hill.
Kirke, D. (2012). Steps to Effective Change Management. Small Business Trends. Retrieved from: http://smallbiztrends.com/2012/10/steps-to-effective-change-management.html
Llopis, G. (2012). 5 Most Effective Ways to Sell Change. Forbes. Retrieved from: http://www.forbes.com/sites/glennllopis/2012/11/05/5-most-effective-ways-to-sell-change/#79af0a893dd7
RESPOND TO GREEN
Glaxo and Wellcome. What they did?
The Wellcome Trust, which owned forty percent of Wellcome company shares, originally stated that they would not sell their shares without discussing the decision with management prior to the sale. The Trust then changed its stance and allowed Glaxo to acquire the shares in support of a hostile takeover. There were no notifications to management, and no integration or merger plan was presented before the announcement. In previous chapters we learned that mergers and acquisitions are very stressful on employees. “Research indicates that at least two hours of productive work per employee per man-day is lost during mergers and acquisitions activity in the organizations.” (Brahma and Srivastava, pg 10). The workforce went from being secure in their jobs and assured that they would be notified of any merger prior to the event now felt betrayed, stressed, and unsure of their futures. The near future now holds a possibility of monetary losses associated with workforce turmoil, and less work productivity.
What They Should Have Done
Wellcome Trust should have notified management of their intention to support the takeover bid by Glaxo. The opportunity for the companies to participate in some sort of opportunity-based change might have given he both companies time to anticipate some of the problems associated with the takeover, allowed for time to devise an integration plan, and maintain the trust between Wellcome and their workforce. Immediately following the announcement of the acquisition, management should have been notified of the need for an integration plan with the parameters and vision set forth in a formal fashion.
Ofra Sherman’s Predicament, and Her Plan and Her Future
Ofra Sherman finds herself in a struggle between multiple companies and personalities. Ofra is a manager for Wellcome Israel, but she and her team make up the pharmaceutical and diagnostics division of the Israeli owned company Promedico. To complicate matters, an official agreement was never negotiated between Wellcome and Promedico outlining terms and or conditions of their business relationship. (Jick and Peiperl, 2011). Additionally Ofra’s general manager made threats eluding to a rough transition, and her boss in Greece angrily told her to do nothing until his express permission was given. Feeling betrayed by two companies, an unsure future and caught between two bosses jockeying for supremacy, she is experiencing a great deal of stress. But she isn’t alone.
Ofra’s Wellcome team is experiencing the same anxieties. She is fact finding with co-workers and superiors, and feels she cannot confide in them or her subordinates. I think that she is paralyzed and searching for answers trying to make sense of the situation. “Sense-making refers to the process whereby organizational members translate an organizational event and construct a meaningful explanation.” (Lotz and Donald, pg 2). Instead of being reactive in this situation I would be proactive and make some tough decisions. I would press Wellcome for answers, and look at the prospect of taking my team’s talent elsewhere. I would create at least three viable courses of action and discuss them with the team. After getting their input we would then proceed with the preferred course of action.
An Evaluation of Ofra’s Actions
I have experienced and understand the difficulties presented in this case. Mrs. Sherman’s inactivity is unsettling in my opinion. In her place, my primary goal would have been to save my job or find employment at another company. She may have been loyal to the company and her team, but her actions leave me thinking that if she loses her job she won’t have a plan. She may be in the second stage of the transition stages called the neutral zone. In this period she would feel adrift and confused and grow increasingly unproductive. (Jick and Peiperl, 2011). I find her actions borderline irresponsible and detrimental to the team that she supervises.
Brahma S, Srivastava K. Communication, Executive Retention, and Employee Stress as Predictors of Acquisition Performance: An Empirical
Evidence. ICFAI Journal of Mergers & Acquisitions [serial online]. December 2007;4(4):7-26. Available from: Business Source Complete, Ipswich, MA. Accessed April 14, 2016
Jick, T.D., & Peiperl, M.A. (2011). Managing Change: Cases and Concepts (3rd ed.). New York,
Lotz T, Donald F. Stress and communication across job levels after an acquisition. South African Journal Of Business Management [serial online].
March 2006;37(1):1-8. Available from: Business Source Complete, Ipswich, MA. Accessed April 14, 2016
RESPOND TO GARLAND
What did Glaxo-Wellcome do?
In January 1995 “Glaxo announced that it was making a hostile bid for control of Wellcome, which would create the world’s largest pharmaceutical company.” (Jick & Peiperl, 2011, p. 354) Wellcome is a U.K.-based pharmaceutical company. Wellcome has operations in Israel. “Wellcome itself was being taken over by arch rival Glaxo.” (Jick & Peiperl, 2011, p. 347 “By acquiring Wellcome which ranked between tenth and twentieth worldwide in revenue.” (Jick & Peiperl, 2011, p. 348)
Wellcome brought to the takeover a company which developed, manufactured and marketed worldwide human healthcare products. To include subsidiaries in 33 countries. “Its products could be divided up into tow categories, prescription and non-prescription (over the counter) medicines, with the former representing over 85 percent of the total revenues.” (Jick & Peiprel, 2011, p. 348) The hostile takeover by Glaxo created much uncertainty within many employees and the management of Wellcome, who had claimed they did not have any knowledge of the bid to take the company. One individual in particular Ofra Sherman and the team they lead for Wellcome had much uncertainty in the outcome for her and her team. Glaxo was not providing much of any guidance of the roles many would play if any.
What should they have done?
Glaxo could have taken more firm steps for a successful takeover. Glaxo could have implemented a process whereby Wellcome employees were given advance warning as much as possible to what was going to happen. Glaxo also could have developed a better team attitude by integration of many if not all of Wellcome and its staff and employees.
“Mergers and acquisitions (M&A) are controversial because of their perceived adverse effects on employment. These transactions are often followed by restructuring, divestments and plant shutdowns, leading to layoffs and reductions in employment.” (Kuvandikov, Pendleton, and Higgins, 2014)
Did Ofra Sherman do the right thing?
“No organization can institute change if its employees will not, at the very least accept change. No change will “work” if employees don’t help in the effort.” (Jick & Peiprel, 2011, p. 336) In many ways yes she did. Many leaders thrown into uncertain times or situations will have doubt and fear of the unknown. You cannot let you team see this. The first step is to be very honest with your team. Explain the situation as best as you see it. Be prepared to field hard questions with hard answers. Also have a plan of attack. How you and your team will survive this and move forward.
What would you have done?
“The business environment is not static but operates in a state of flux and constant change; there fore alternate goals must also be determined to ensure that the business is prepared to meet a variety of future scenarios.” (Satterlee, 2013, p. 72) Did Sherman prepare herself and her team for unknown changes in the future? Not really should could have done a better job this is based on our reading that she was involved in almost every facet of her team and her business. One last aspect that she can do is “Often the leader must serve as a heat shield for subordinates who are working the crisis. (Dees, 2013, p. 194.)
What was Ofra Sherman’s predicament?
Ofra Sherman’s predicament was to jump ship and go directly to Glaxo. Or to use her muddied chain of command and work the issues this way. “Officially Sherman had a manager at Promedico.” (Jick & Peiprel, 2011, p. 353) Sherman’s boss was her manager in name only. “Sherman’s peers at Promedico envied her.” (Jick & Peiprel, 2011, p. 354) Sherman was not one to rely on Promedico management in her daily duties. The only real link was “receiving information from them about what was happening within Promedico.” (Jick & Peiprel, 2011, p. 354) She had to be very careful about the flow of information because she knew it would filter back up to Promedico.
How did she get into it?
Sherman and the different entities in this example had no clear cut guidelines. No clear lines of reporting or over site. Sherman was experiencing “a major reaction to change is a feeling of losing control.” (Jick & Peiprel, 2011, p. 341) In my opinion she should have worked on clearing this aspect up before the situation ever developed into what it is currently.
How do you evaluate her actions as described in the case?
Sherman is a good leader overall. The true evaluation of her leadership skills thru this trial is how she handles conflict and does she shield her team. “Conflict is a process that begins when an individual perceives that he or she has been negatively affected by another individual or group.” (Satterlee, 2013, p. 172) Sherman displays this with her non-free flow of information with Promedico. “Relationship conflict occurs when individuals within a group fail to communicate effectively. This type of conflict can escalate so that everyone directs attention and energy towards the conflict and little attention is paid to the organization’s goals. (Satterlee, 2013, p. 173)
Dees, R.F. (2013). Resilient leaders. Williamsburg, VA: RFD, LLC.
Jick, T. D., & Pieperl, M. A. (2011). Managing Change; Cases and Concepts (3rd ed.). New York, NY: McGraw-Hill
Kuvandikov, A., Pendleton, A. and Higgins, D. (2014), Employment Change after Takeovers: The Role of Executive Ownership. British Journal of Industrial Relations, 52: 191–236. doi: 10.1111/bjir.12012
Satterlee, A. (2013). Organizational management and leadership: a Christian perspective (2nd ed.). Raleigh, NC: Synergistic International Inc.
DB Forum 3.docx (43.478 KB)