HRM 3430 Chapter Notes - Chapter 12: Headcount, Market Power

• School: York University
• Department: Human Resources Management
• Course: HRM 3430
• Professor: Leigh Lampert

Document Summary

Definitions: merger consolidation of two organizations into a single organization. Horizontal merger merging of two competitors to increase market power (subject to review by regulators who fear monopoly power in the marketplace) Vertical merger merging of a buyer and seller or supplier to achieve synergies of controlling all factors affe(cid:272)ti(cid:374)g a (cid:272)o(cid:373)pa(cid:374)y"s su(cid:272)(cid:272)ess (fro(cid:373) produ(cid:272)tio(cid:374) of raw goods to (cid:373)a(cid:374)ufa(cid:272)turi(cid:374)g to distri(cid:271)utio(cid:374) and retail sales) The urge to merge (1) strategic benefits: acquisition of companies in different regions or serving different markets are much quicker than international expansion, strengthen competitive position by acquiring competencies that make their core competency less imitable, achieve complementarities. Operating synergy cost reductions achieved by economies of scales produced by a merger or acquisition: gain access to new markets, redefine their businesses, diversification may reduce reliance on one market, achieve benefits associated with: Vertical integration merger or acquisition of two organizations that have a buyer-seller relationship.