Rebuilding Organisational Culture as a result of the Absa/Barclays Acquisition
- September 9, 2014
- Posted by: CA_dev.
- Category: Masters Abstracts
Author: Maharaj, Cheyani
Supervisor: Professor Erik Schmikl
Date: September 2010
The research describes the typical effects mergers and acquisitions have on the staff involved in the Absa/Barclays merger and the impact the merger had on the culture of the Absa Group Operations department. The research was conducted within the Absa Group Operations department in Absa, Johannesburg. In 2005, Britain’s third-biggest bank, Barclays, acquired Absa, South Africa’s largest retail bank. In 2006, Barclays and Absa Management performed a due diligence study, covering finance, market opportunity and operations. However, a culture or climate assessment that evaluates the cultural fit between the two banks was not done in detail during the strategic planning process.
Many acquisitions or mergers fail because organisations pay insufficient attention to the culture. A merger and acquisition transaction is a setting for great uncertainty and frequent rumours. The researcher identified a lack of communication as the main reason hampering change efforts in Absa. It was evident that the staff experienced a culture shock, as the affected staff not only needed to abandon their own culture, values and beliefs, but also had to adapt to a different culture.