Can the Music Industry Change Its Tune

EMERGENCE OF NORDEA

Table of contents

1 What is the Basic Problem/Challenge? 3

2 Definition of the problem 3

3 SWOT ANALYSIS 4

4 Financial Aspects/Impact. 5

5 Alternative Solutions 5

5.1 Solution 1 5

5.2 Solution 2 6

5.3 Solution 3 7

6 Our proposed solution 8

6.1 Why this solution 8

7 Summary & Conclusions 8

1 What is the Basic Problem/Challenge?

(The assumption in this case study analysis refers to the new Business Unit NORDEA "Markets" when talking of the 3 different banks, which merged.)

Merge with your competitor & become stronger!!

If you cannot beat your competition, buy it out!!l

Mergers are not problems - if they were, there would never be mergers!

However, what to do after a merger. Here starts the problem .... no Challenge!!!!!!!

If this is seen as a problem, then it has to be solved somehow. However, we see it as a Challenge to be tackled. This approach can improve our & the Company's worth & reputation in the eyes of the internal & external stakeholders, as the employees sense the interest of the Management to solve complex issues from the front & not just running round the bush.

2 Definition of the problem

In this complex business situation, three Scandinavian banks merged as response to a downturn in the industry at the end of 1980s. This meant the 3 different nationalities, 3 organizational cultures, 3 organizations with imbalanced success etc. Naturally, the idea behind merger is to create the single entity, where the sum of total output would be greater than the sum of outputs of separate components. Definition of the problem in a simple single statement could be: Create one organization that will result in synergy.

When Nyegaard projected this task at his N Unit, he started implementation of the excessive integration program based on cultural seminars. The focus was put on cultural differences, and tendency to define and solve main challenges through common effort of the management group. The idea is positive, and, for example first seminar focuses on cultural differences whereas the second one tries to define the "common" ground for all three subunits. This is inline with theory of multicultural awareness.

If we want to look at some specific characteristics and symptoms of the general problem of the merge, it is seen that after conduction the integration program, work life balance, cultural differences, or the way of implementing and measuring the 4C values still exist.

3 SWOT ANALYSIS

3 x companies have merged CBK of Norway, Fin-Swede Merita-Nordbanken (MN) & Danish Unidanmark (U) to form the NORDEA (N)

Each of the above companies brings in a lot of advantages & disadvantages, which are considered in the form of a SWOT analysis for the new merged organisation NORDEA as below:

Strengths of Nordea

* Huge human resources pooling with the merger with large knowledge banks.

* Pooling of the strategic visions of the 3 merged organisations.

* Strong synergies of the 3 organisations.

* Larger organisation - more power in the market.

Weaknesses of Nordea

* Nordbanken - Weakest in its own domestic market. Their success was largely dependent on the other business units which generated a lot of profits.

* NM did not have a clear organisational picture. No strong direction, however strong ideas of staying separate & about non-integration.

* NM managers were always quarrelling about ''Finnish -Swedish'' issues: Cultural differences were large.

* U had a large head count - overstaffed.

* U was seen as a threat by NM.

Opportunities of Nordea

* Due to the merger, the new bank Nordea had a large share of the market & with this it could lead in a much stronger way to capture further markets.

Threats of Nordea

We consider the Interactions between the different merged units as a combination of the internal & external processes.

* Internal fighting within the 3 merged organisations

* Large work force, which N cannot sustain - staff cutting required, resulting in fear in their employees.

* Economy downturn.

* Cultural differences of the 3 countries, nations & their people.

* The organisations had gone through mergers & re-organisations in their last few years. This had left the employees unsettled. This merger will again bring in one more period of unsettlement till the various outstanding issues are settled.

4 Financial Aspects/Impact.

With a strong focus on the Employee Development of a large Merged Organisation, it is obvious that the financial figures have to improve........................

Well, not necessarily!!!!!!!

If the main Assets of the Company - its Human Resources are shown the proper direction with a focused

development, then the Company moves towards the path of Strong Sustainable growth in the long run future. This gives rise to increased profits & better bottom line figures.

However, NORDEA has to also take care of issues such as transparency, accountability & business ethical behaviour as these are the buzzwords in the Financial World today.

5 Alternative Solutions

We propose the following three solutions as a go ahead possibility for NORDEA in response to