Olympic Group Acquisition of Ideal Case

Olympic Group (OG), an Egyptian white goods giant, acquisitioned IDEAL, a state-owned home appliance company. The case discusses the macro-economic and political environment past, present and future in Egypt, the history of the home appliance industry in Egypt, and IDEAL’s and OG’s business model. After an in-depth insight into these topics are addressed, the situation post acquisition with production, human resources, staff, operations and the IDEAL brand image were explored in search of an answer for the best way to integrate the two companies.

Many obstacles arose because the companies were so vastly different from each other, starting with the obvious: transforming IDEAL from a state-owned company to a private-owned company. Saying so, the differences were on complete opposite ends of the spectrum in regards to the organization structures, ideas, values and overall culture of the companies individually. Another worrisome conflict that was very evident was the emerging of employees from the two firms, as uncertainty prevailed in the most effective and efficient way to accomplish this without negatively impacting overall performance.

I would recommend that OG create programs or incentives to help keep employee morale high. For example, tracking individual’s progress in a recording system to ultimately demonstrate the opportunities available to them and how they can and will accomplish an achievement in exchange of promotion. Also, I think that a review needs to be done of both employee contracts before the acquisition occurred, and a new contract should be devised that is essentially a compromise for both sides; a behavioral learning approach. Once the employees get adjusted to the new contract, then a slow introduction of new business models and products can be presented to them. This process has to be gradual in order to avoid angry or any anti related responses. A new relationship has to be established first, because trust is the foundation to success.