My article titled 'How to make a mess of an acquisition - Daimler Benz Style' has not received the attention it deserves. In this page, I will give a case study of how an acquisition can be made a success. Hyundai is a South Korean Chaebol into heavy engineering. It gained prominence in ship building and became a big competitor to the Japanese giant Ishikawajima Harima Heavy Industries (IHI). It is practically into anything and everything like other South Korean Chaebols. Most Korean companies are run like autocratic empires with iron fist and discipline. It suits their culture though western companies may frown upon such a style. As a natural extension in engineering, it became a auto manufacturer over the period of growth. It became the largest auto manufacturer in Korea after Daewoo collapsed with USD 16 billion debt and went into receivership in the year 2000. Another manufacturer Kia Motors of Korean origin was also in debt and under receivership. Hyundai bid for it and took it over. At one stage they were arch rivals and hated the sight of each other. In Asian cultures, business rivalry can become really personal and appear right out of fiction.
In late 1998, Hyundai took over Kia Motors, which was thought to be unrecoverable. Most felt it was a stupid mistake. Skeptics were proved wrong. Within two years the sales went up by 400%. What was the secret of the success ?
All key people were from Hyundai. Kia had a laid back culture. People were told to perform or get out. Fear can be a big motivator, in rare cases. Corruption in South Korea is not unknown at the highest levels.
Downsizing was done very rapidly and about 5000 people were sacked.
The number of platforms were 23 in all when the merger took place. They were reduced to 7.
Parts were standardized but R&D ensured that all the end products look different.
One unique aspect of most Hyundai cars is that you can't start the engine unless you declutch. When I tried driving a Hyundai car of my friend for the first time, I went mad. I understand cars and anything mechanical and rated a very good fast but safe driver. The problem is modern cars look like the control panels of aircrafts with everything electronically controlled. Driving is instinctive and reflexive. I don't feel comfortable with automatic drives even now.
All vendors were standardized for both the companies.
Over the period from 1998 till date, Hyundai and Kia have carved out a niche for themselves and are rated higher than Toyota in non luxury segments.
Hyundai was eyeing Daewoo seriously and I do not know the latest position. Hyundai is one of the top 50 global brands. People like Mr. Rupert Murdoch and organizations like Hyundai will always make a success of any such acquisitions. One needs to be ruthless in an acquisition and merger process for it to be success apart from managerial and financial skills.
© Copyright, Aug 20-08 . Without prejudice. All rights reserved
How to make a success of an acquisition HyundaiKia Style - To learn more about this author, visit Madhavan T Gopalachary's Website.
Like this article? Share it with your friends
 |
Related Businesses - Evan Elite Authors |
|
David Barr
David Barr is the President of Venture Opportunities, Inc. David has been a professional business broker/intermediary since 1980 focusing on General Business Brokerage and Mergers and Acquisitions representing client transaction value from $400,000 to $20,000,000. Mr. Barr has handled the sale of over four hundred and fifty companies. David earned a university degree from the State University of New York majoring in economics and business.
David holds the Mergers and Acquisition Master Intermediary and the Certified Business Intermediary designations from the International Business Brokers Association. He is also a Senior Business Analyst and a Texas licensed Real Estate Agent. For more information about David and Venture Opportunities, visit www.bizdealmaker.com. - Visit David Barr's Website |
|
Kim Castle
With nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation.
BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them?
If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
|
Vwodek Wojczynski
Business Coach and Consultant Vwodek Wojczynski (pronounced Voy-chin-ski) brings fun, awareness, accountability and fresh perspectives based on his diverse experiences in life and business.
Born in Poland and educated in Greece and Canada, he is trilingual with 8 years experience in business development with clients in Canada, USA, Switzerland and Poland.
His approach is systematic and process-driven. He fuses the know-how of proven business methods with his commitment that entrepreneurs experience satisfaction and joy based on their values, motivations and strengths. He believes that businesses succeed based on their ability to generate value by providing what’s needed and wanted.
Ultimately, he trains executives and true business owners - people who work less, produce more, own businesses that run automatically after a while and make a difference globally.
His current research focus is the development of intelligent business systems and the application of emerging artificial intelligence technologies in business.
He is also an avid traveler, spoken word performer and visual artist. He resides in Toronto, Canada. - Visit Vwodek Wojczynski's Website |
|
George Ludwig
George Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance.
Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson.
His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more.
George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
|
Leanne Hoagland-Smith
Are your sales where you want them to be? Will you be one of the few who achieves sales success or one of the many who have failed to change? So what are you doing to change those results? Let’s be honest, with companies moving globally and at lightening speeds, the traditional business solutions are outdated and dead. My approach moves your business out of its comfort zone and secures your competitive advantage now. If you are seeking to increase sales, build customer loyalty, create a culture of great attitudes or just achieve some sleep filled nights, then we should talk because my clients have experienced exactly those types of results. Learn more about customer loyalty at http://www.processspecialist.com/customer-loyalty.htm Give me a call at 219.759.5601 for a free strategy session. P.S. If you are seeking a motivational speaker, sales trainer or small business expert that will leave your audience smiling and remembering, please feel free to contact me at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
|
The Evan Elite Authors program is currently in beta phase. For details please contact us.
|
|
|
Madhavan T Gopalachary
(Visit Madhavan's Website)
Madhavan Gopalachary, nick name "madgopes"
(g pronounced as in go) given by IIT
classmates, is a Mechanical Engineer and
an alumnus of Indian Institute of
Technology, Madras having passed out
specializing in IC Engines &
Thermodynamics.
He has nearly 35 years of experience in
the Corporate World. He started off as a
trainee and handled sales, marketing,
manufacturing, product management, profit
center management, strategic planning and
corporate development including R & D in
various organizations and at various
levels before becoming a CEO. His last two
professional assignments were at CEO level
before embarking to start management
consultancy business on January 01, 1998.
He has worked for British, Swedish MNCs as
well as very large Indian business houses.
He has spent a large portion of his time
from June 1998 till date in East African
Countries practicing as an independent
Management Consultant.
More details can be obtained at the
following web sites:
mmg.name
/mtg.html;
mmgconsu
lting.biz/
Madhavan's articles can be accessed at www.madgopes.com
.
|
|
 |
|
|
|
|
![[Get Copyright Permissions]](http://license.icopyright.net/images/icopy-w.gif){kind=small}
My friends at FeedBurner surfaced today with a post titled Hello? Hellooooo? In it, they explain what they've been up to post-acquisition by Google. Two words - technical integration.
