Introduction and Purpose
The term merger and acquisition refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling and combining of different companies that can aid, finance, or help a growing company in a given industry grow rapidly without having to create another business entity (Ben and Li, 2014). According to “Corporate Innovations and Mergers and Acquisitions,” almost two-thirds of all public mergers in the United States are a result of technological innovations, innovative post merger improvements, and cultural synergy (Bena and Li, 2014). Additionally, the strategic planning and implementation of creating this synergy creates one of the biggest challenges for Human Resources. …show more content…
Failure of a merger or acquisition to achieve financial or strategic objectives is often blamed on a clash of cultures between combining entities (Marks, 2011). The purpose of this paper is to address the HR ramifications of the Southwest Airlines merger and the unique responsibility of the strategic and administrative functions of Human Resources. This paper will also provide an analytical approach to the Southwest merger by conducting a SWOT analysis, analyzing culture and policies, recommendations, recruitment methods, and the organization’s total rewards.
SWOT Analysis from an HR Perspective
A SWOT analysis examines the strengths, weaknesses, opportunities, and threats of an organization. The SWOT breakdown helps HR professionals work towards implementing programs and policies that help sustain the competitive advantage in recruitment methods, work culture and total rewards. Based on the outlined SWOT analysis, the HR professionals at Southwest Airlines can recognize areas of improvement and opportunities as well as areas that lack competitive …show more content…
HR professionals from both Southwest and AirTran will have to identify the areas that are higher cost with lower productivity, timely employee development and training, and prepare for the influx of new and old employees. Additionally, the merger will cause consolidation of functions and resources. As a result, Human Resources will have to manage a large amount of employees and combine assets in a small amount of time. This will be a challenge for HR to align organizational structure when combining the two entities and ensuring effective and fair policies are in place (Marks 2011). Retention and employee resistance may also be a result of changes in functions and resources, another challenge HR must prepare for.
Opportunity
Areas of opportunity tend to be changes in the market and technology. Specifically for Southwest Airlines, HR professionals must leverage the influx of employees as opportunity to invest in the talent growth of the organization, identify new talent, and promote career growth. Human Resources can take advantage of the influx of new employees and enforce total rewards programs that will retain and attract employees. Companies that invest in the talent growth of their organization are more likely to retain employees and recruit the best talent.