The Business 2.0 - Unit 7.

Pag 88
Listening for detail

1. According to Bernard Degoulange, what is the best reason for a merger?

Answer: Is that the customers are asking you for something you can´t delivery.

2. Explain how he uses the example of champagne and whisky to show why external
grows is necessary.

Answer: Everybody would like to be able to get the solution to all of life´s problems
from the same place. If people are satisfied with your champagne, they’re going to
start asking for whisky.

3. Explain each of the points summarized by the five Gs.

Answer:

 Goals: both companies need to be compatible goals, and trying to achieve

something similar.
 Gains: The companies want to know if there will be real gains in terms of
economies of scale. And these gains will compensate for perhaps not being
able to react to new trends in the market because of the size of the
organization.
 Genes: There´s no point in trying to merge a traditional, hierarchical family
business with a fast moving start-up with relaxed management style. It just
doesn´t work, the cultural genes are too different.
 Geography: If the companies are not based in the same city or geographic area
the communication between headquarters is more difficult.
 Growth: The merger needs to provide technology or skills that you don´t have,
which would take too long to develop yourself, and which will allow your
company to grow.

4. What opportunity does a merger offer the competition, and why is it possible?

Answer: To jump in and take market share from booth companies in the merger.
WHY???

5. Why is a merger a traumatic period according to Bernard Degoulange?

Answer: Because two companies die and a new one born.

6. How does he say companies should help people get through this trauma?

Answer: Explaining how things will change and what their new roles will be, and to get
them to accept the new organization and their new identity.