rocket singh

1The 11 Corporate Lessons From Movie Rocket Singh By Ashraf Chaudhry — Document Transcript 

1. The 11 Corporate Lessons from Movie „Rocket Singh‟ The 11 Corporate Lessons from Movie Rocket Singh SALESMAN OF THE YEAR Reviewed by: Ashraf Chaudhry Sales & Marketing Trainer & Author of International Best Seller The Craft of Selling “YOURSELF” Email: [email protected] Cell: +92 321 9274723 Timezone: GMT+5 1st February 2010 [Google Profile]

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2. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Money & Motivation Lesson # 1 Money doesn‟t motivate everybody equally. • You cannot always convince people with money only. • You need to persuade, converse, negotiate and engage. • Money is one of the several variables of motivation. Someone needs just sweet words and someone needs a little persuasion. • Tailor the approach of motivation. Use money where it is required only.

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3. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Right Aptitude Lesson # 2 To thrive in sales, you need right aptitude (not just marks on your degrees). You can be a topper in the university and the greatest number cruncher on planet earth but may not be a great salesperson (an influencer, a persuader and negotiator.) To be a great salesperson, you need to have right aptitude……an aptitude of empathy, an aptitude to see beyond the obvious.

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4. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Ice- breaking Lesson # 3 “Disturbing” others is pre-requisite to be salesperson. Asking (or disturbing people) is pre-requisite to become a great salesperson. If you are hesitant to break the ice, start conversations and ask for help and guidance and engage people in discussions, you then need to cultivate

people skills. Great salespeople come one step forward, after saying hello, they confidently say, “Can you please help me”? 

5. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Honesty & Integrity Lesson # 4 What is good for the goose cannot be bad for the gander! Don‟t expect honesty from salespeople in the organization if you encourage them to become kick-backers and bribers with the clients. If organization encourages its sales and marketing teams to bribe the clients‟ organization to take orders, it is, in fact, plowing the seeds of dishonesty in the organizational culture. Organization has no right to expect internal integrity and honesty if it is promoting malpractices in the clients‟ organizations.

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6. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Customer Service Lesson # 5 The greatest secret of success in business: Satisfied Clients Customer Service (24/7) makes the organizations outsmart the competition. In order to thrive and excel in the business, organizations need to cultivate a service culture across the board. You cannot afford to forget the customer once you take the check. Delighted and satisfied customers are your ambassadors and their referral can generate more business than you can handle.

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7. The 11 Corporate Lessons from Movie „Rocket Singh‟ About Ashraf Chaudhry Despite his early education from roofless and ghost schools of rural Pakistan, he graduated from no less than Institute of Business Administration (IBA), Karachi. He has worked for around one and a half decade for blue chip companies like Chevron, Tapal Tea, Pearl Continental & Marriott Hotels and Worldcall Group before joining corporate training industry. He is author of international best-seller The Craft of Selling “YOURSELF”. He is also co-author with Bob Urichuck, Sales Trainer ranked # 7 in the world, for their up- coming sales novel, The 10 Commandments of Selling: Story of Danial, to be launched world- wide in June 2010. Some of the most popular training programs created by Ashraf Chaudhry are: 1. The 10 Commandments of Selling 2. The Real Guerrilla

Selling 3. Heart Selling 4. Unlocking the Real “YOU” 5. Raising Sales Infantry To book Ashraf Chaudhry for customized Sales & Marketing trainings and for conferences, please call Ms. Faiqa Hafeez at +92 321 9444 522 or drop an email at [email protected] [Google Profile] 

8. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Intrapreneurship Lesson # 6 Make people Partners in business; they will be no more Pain! If associates are treated like partners, they will own the organization. Allow them to grow as the company grows. If humans are treated as Resources and Capital meant to be consumed and used, they will act like leaches sucking away the vital veins of the organization and reaching out to the bone marrows. Sales & Marketing people employed on fixed salary work from 9 to 5. If they are partners in the profitability, they will sell even in dreams and will become killer sales machines……timeless and spaceless. Mediocres become Masterminds when they are involved.

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9. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Value of Zero Lesson # 7 Even zero has the value. Zero is magical in character. It can multiply the value of any number if placed rightly. The lowest person in the organizational hierarchy can do wonders if he/she is put at the right place. And genius can ruin the whole game if placed wrongly. Matching of inherent talent with job description is critical for success of the organization.

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10. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Inherent Quality of “Rise & Fall” Lesson # 8 Every one is born with potential of „vice & virtue‟. Every employee has both the qualities……the qualities of Rising & Falling in career. Which quality is dominant, determines your destiny. Certain attitudes will put a gravitational pull on you while others will make you „sky‟s the beginning‟ type.

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11. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Risk Taking Lesson # 9 Spiderman also takes the risk. Jumping out of comfort zones, taking initiatives and playing with risks is what makes the difference. If you

are stuck in the grooves of „safety‟, you end up nowhere. The road from Good to Great is paved with taking initiatives. The biggest risk in life is to avoid the risk. Even Spiderman has to take the risk. 

12. The 11 Corporate Lessons from Movie „Rocket Singh‟ Have you booked your seat for cutting edge workshop on Sales & Marketing? Cracking the Code: How to Use Social Media for Sales & Marketing? Karachi Marriott Hotel, 23rd February 2010 Lahore Avari Hotel, 26th February 2010 Please download the brochure for more information. [Google Profile]

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13. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Team building Lesson # 10 You need a loyal team to build Rocket Sales Corporation. Great organizations are built by great teams and not by accident. Teams are built by reinforced trust, mutual respect, sharing and caring. The trust deficit among the team members erodes the team spirit. Build a great team; build a great organization.

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14. The 11 Corporate Lessons from Movie „Rocket Singh‟ On Gathering Intelligence Lesson # 11 If salesperson cannot read the paper in reverse, he/she is blind. Every Sales & Marketing person has to keep his/her eyes and ears open to scan the information regarding prospects, competition and the market influencers. In the game of business, right information at the right time gives you „unfair‟ advantage. Be the corporate Sherlock Holmes.

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15. The 11 Corporate Lessons from Movie „Rocket Singh‟ Did you like the review? If yes, please share it with your colleagues and friends. Feedback? [email protected] Want to get connected with Ashraf? Facebook LinkedIn Twitter Free e-book every week Join the Facebook Group (Seminars, Conferences & Workshops) and get free e-book every week. Instant download 1st chapter of Ashraf Chaudhry‟s book The Craft of Selling “YOURSELF”. Please click here [Google Profile]

Volunteer Engagement Mobilization Plan Volunteerism is an important value in our society. When people are engaged in their community, there are benefits to the volunteer, to the people and organizations that they serve and, for the community as a whole. Volunteers help agencies provide the wide range of services that are available in our community. Nonprofit agencies and community organizations would not be able to provide the breadth and depth of services they offer if they didn’t involve volunteers. Volunteers: • Bring fresh perspectives • Expand diversity • Provide leadership • Help agencies reach new audiences and markets • Extend staffing capacity • Are ambassadors and advocates for the causes in which they are involved • Create an environment of people that care about their communities • Donate money at a higher rate than non-volunteers There is increased national attention on volunteerism. The Edward M. Kennedy Serve America Act was passed in March 2009. This bill reauthorized and expanded the mission of the Corporation for National and Community Service (CNCS) to: • Increase opportunities for Americans of all ages to serve • Support innovation and strengthen the nonprofit sector • Strengthen management, cost-effectiveness, and accountability of programs supported by CNCS • Authorize a Civic Health Assessment comprised of indicators relating to volunteering, voting, charitable giving, and interest in public service in order to evaluate and compare the civic health of communities

From the White House to the entertainment industry, from corporations to college campuses, initiatives have been created to encourage volunteerism and help people get involved locally and globally. Websites include: serve.gov, dosomething.org, Volunteer Match, idealist.org and iparticipate.org. Locally, our United Way has been committed to helping people find interesting and meaningful volunteer opportunities for over 30 years when the Volunteer Center (originally the Volunteer Services Bureau) became a part of our organization. The Board has affirmed the importance of mobilizing volunteers to advance the Agenda for Change while helping people find volunteer opportunities that meet their personal interests, skills, time availability, and other needs. It’s the marriage of strategic financial investments, effective and efficient nonprofit organizations, well managed volunteer programs and the dedication of community volunteers that creates meaningful community impact. Although we know that the people in Dane County are very generous with their time, we also know that there are a lot of people who do not volunteer but would if presented with the right opportunity. This plan will address why people don’t volunteer and how we will increase the rate of volunteerism in Dane County. 2 I. Problem Statement According to a survey by the Corporation for National and Community Service (CNCS), 1 the rate of volunteering has remained fairly steady from 2005-2008, with 61.8 million Americans (26.4%) of the adult population volunteering in 2008. As the population grows, the number of volunteers is increasing. The study noted that informal volunteering (i.e. working with neighbors) increased by 31% from 2007 to 2009. A separate 2009 national survey shows that 72% of Americans say they have cut back on the

time spent volunteering, participating in groups and doing other civic activities due to the economic downturn. 2 Given these challenging times, it may not make sense to read too much into the long-term implications of these short terms trends. The CNCS survey finds that Dane County has very high rates of volunteerism: 41.5% of residents volunteer, ranking us 4 th within mid-size cities surveyed in United States. This is a total of 191,700 volunteers. These volunteers are generous: averaging 87.5 hours of service annually. Unfortunately, we volunteer only 36.3 hours per resident per year – three hours a month – making us 42 nd in among mid-sized cities in the U.S. 3 Thus the net impact of our volunteering may fall short of local need. There are many reasons do not volunteer. • The main reason is they simply have never been asked to do so by someone they trusted. • Non-volunteers see themselves as essentially different from volunteers. They tend to think of volunteers as retired, without children, and with an abundance of leisure time. • Many non-volunteers fear the time commitment of service, expressing concerns that signing up for a volunteer activity would require that they continue indefinitely, even possibly for a lifetime.

• Poor volunteer management turns people off. Former volunteers said that if they had a bad experience with one organization, they were turned off from volunteering altogether. 4 According to one study, the median paid staff volunteer coordinator in agencies only spends 30 percent of his or her time on this task. 5 This same study showed that less than half of the organizations had adopted most volunteer management practices advocated by the field. Other reasons people do not volunteer: • Lack of understanding of program – job, organization, clientele • Insecurity about skills • Agency is unfriendly to newcomers – too exclusive • Cultural/environmental obstacles – language, transportation, child care • Job doesn’t sound exciting • Organization is too controversial • Recruitment goals too general 6 And… • They don’t think they have anything to contribute • Don’t know who to ask • Think there are enough volunteers already 7

1 Corporation for National and Community Service (CNCS) Volunteering in America 2009 2 Civic Health Index – 2009 3 CNCS – Volunteering in America 2009 4 CNCS – Volunteering In America: Pathways to Service: Learning from the potential volunteer’s perspective – July 2009 5 Urban Institute. 2004. Volunteer Management Capacity in America’s Charities and Congregations: A Briefing Report. Washington, D.C. 6 NAFSA – National Association of International Educators 3 For the near future, issues related to the economy may have an impact on people’s interest and ability to volunteer. It will be more difficult for people to volunteer if employment, housing and other basic needs continue to be of concern. However, we also know that people who are unemployed sometimes turn to volunteering to build their résumé and increase self esteem, which can lead to an increased interest in volunteering in the future. Why people stop volunteering The number one reason people start to volunteer is simply because they were asked (more on this later). But in order for volunteers to continue volunteering they must feel valued, see results of their work and be respected. Here are the top reasons why volunteers leave an organization (in order of importance) 8

: • They were underutilized • The physical environment did not support their efforts • The atmosphere was impersonal, tense or cold • They made a suggestion that was not acted on, or responded to • They did not know how to say they wanted to leave • They did not see the connection between one day's work and another • Veteran long term volunteers wouldn't let them into their "insider" group • Employees treated them as an interruption, not as welcome (and anticipated) help • The reality of their experience was not what they expected when they signed on II. National Research Nonprofit and voluntary organizations, individuals, and society as a whole benefit from the activities of volunteers. According to the Canadian Centre for Philanthropy: 9

Benefits of volunteering • 79% of volunteers said that their volunteer activities helped them with their interpersonal skills, such as understanding people better, motivating others, and dealing with difficult situations • 68% said that volunteering helped them to develop better communication skills • 63% reported increased knowledge about issues related to their volunteering. More volunteering = more benefits • 78% of people who volunteer 188 or more hours per year reported gaining communication skills, compared to just over half (52%) of those who contributed 19 hours or less

Job skills as a motivator • 23% of volunteers said that they volunteered to acquire job related skills and improve job opportunities. • 55% of volunteers aged 15 to 24 said that they volunteered to improve their job opportunities There are also health benefits of volunteering Over the past two decades, a growing body of research indicates that volunteering provides not just social benefits, but individual health benefits as well. This research has established a strong relationship between volunteering and health: those who volunteer have lower mortality rates, greater functional ability, and lower rates of depression later in life than those who do not volunteer. Highlights of this work:

7 National Council of University Research Administrators 2005 8 VolunteerLimirick.com 9 2000 National Survey for Giving, Volunteering and Participating, Canadian Centre for Philanthropy 4 Older volunteers are most likely to receive greater health benefits from volunteering. Research has found that volunteering provides older adults (those ages 60 or older) with greater benefits than younger volunteers. These benefits include improved physical and mental health and greater life satisfaction. In addition, while depression may serve as a barrier to volunteer participation in mid-life adults, it is a catalyst for volunteering among older adults, who may seek to compensate for role changes and attenuated social relations that occur with aging.

10 Volunteering leads to greater life satisfaction and lower rates of depression. Evidence indicates that volunteering has a positive effect on social psychological factors, such as a personal sense of purpose and accomplishment, and enhances a person's social networks to buffer stress and reduce disease risk. 11 Evidence suggests the possibility that the best way to prevent poor health in the future is to volunteer. A number of studies demonstrate that individuals who volunteer earlier in life experience greater functional ability and better health outcomes later in life, even when the studies control for other factors, such as socioeconomic status and previous illness. 12 III. What Works/Best Practices To build a plan to mobilize more volunteers and to have an impact on giving volunteers a positive experience, we need to understand why people volunteer, how they volunteer and what it will take to get them to do more and be effective. Let’s examine the reasons why people volunteer 13 • Giving back to a cause/issue/agency they are passionate about, to make the neighborhood or greater community a better place or to help with an area in which they have received services from in the past and now they are able to give their time to others facing this situation. • Trying something new. Many people want to do something completely different in their volunteer work than they do in their “regular” work (ex: an accountant who would rather read to children than be the treasurer of the board or a teacher who would rather build

houses than be a tutor). • Learning about other areas of their community. Often we have our routines of where we go in our community – home, work, regular shopping places, etc. By volunteering, you can go to and learn about people who live in different areas of your city/community, different cultures, environments, etc. • Personal satisfaction. In most cases the biggest personal benefit is simply feeling good about yourself. Volunteers can go home knowing they have done something important for their community and the people they touch through their involvement. • Developing personal and professional skills such as leadership skills (by serving on a board), sharing business skills such as marketing, strategic planning, facilitation, etc.

10 Li and Ferraro, 2006; Van Willigen, 2000 11 Herzog et al., 1998; Greenfield and Marks, 2004; Harlow and Cantor, 1996 12 Lum and Lightfoot, 2005; Luoh and Herzog, 2002; Morrow-Howell et al.,2003 13 i-to-i.com5 • A sense of accomplishment. Many people choose to volunteer simply for the pride that comes from completing something such as putting the last roof tile on a house or hearing a student read a story or complete a math problem on their own. • Recognition and feedback. This doesn’t mean that volunteers are in it “for the glory.” But many times we don’t get feedback or recognition for a job well done in our regular work, so getting it through volunteering is a double bonus – you know you are doing

something meaningful and others realize it as well. This inspires pride and confidence and a desire to do even more! Volunteers make commitments to volunteering on multiple levels. According to a 2009 Summit held with United Way Worldwide staff leaders in volunteerism, there are five levels of volunteering, each with distinct roles and impact. 14 Direct Service Advocacy Board Committees Skills-based Capacity Building Ongoing Impact One Day & Episodic Service Projects Volunteer Segments Board / Committees = Multiplier for agency’s effectiveness, (if properly engaged and supported) can accelerate agency’s impact, fund raising and reputation by improving agency’s strategies, executing strategies and communicating work. They are the premier ambassadors for an agency. Skills-based = accomplish deep capacity building as they will drive efficiencies. Example: Volunteer consultants who share their business skills to help strengthen the business side of nonprofits Ongoing = see the direct impact and see contribution to larger issue Example: Volunteers who answer United Way 2-1-1 phones

Episodic = “point of sale” for United Way/agency Example: Days of Caring volunteers

14 United Way of Massachusetts Bay and Merrimack Valley 6 What this means for us Each of these segments is important to our work, each has appeal to a certain segment of volunteers, and each plays a critical role in our organization. Some of the greatest value from volunteers (for us and volunteers) comes from people who are in the “ongoing” segment. Focusing on the “ongoing” segment can increase: Impact: Accelerate impact by providing much needed services (i.e. every child gets a mentor, increases likelihood of graduating high school) Revenue: These volunteers are more likely to be donors; Broad volunteer mobilization makes United Way more attractive for grants and other funding Reputation: These volunteers will be the best informal ambassadors and advocates for United Way. Leadership: These volunteers can be cultivated and moved up the pyramid toward committee and Board roles, creating a more diverse pipeline to Board 15 How do people get started? While there are many reasons that motivate people to volunteer, the main reason people start to volunteer is because someone asked them….it may be a friend, a colleague, an agency’s volunteer, a family member, etc. An “ask” by someone you relate to is very powerful. However, while that personal ask may get a person started volunteering, the reason people continue to volunteer at an agency is because they:

• feel valued • see the results of their work • are respected • have meaningful work to do • have a clear job description and duties What’s important at the nonprofit/community agency? In order for volunteers to have meaningful volunteer experiences and want to continue volunteering, it is critical that there is someone at the agency that understands volunteer management and is trained in best practices. Agencies that are deploying volunteers needs to identify a volunteer manager with time allocated for this role, duties spelled out clearly as a part of their job description, training and professional development, and accountability for assuring meaningful volunteer work. The best volunteer managers are leaders who possess the following skills: 1. Proven organizational and management skills. Volunteers have a strong desire to add value and see results. Organizational skills will contribute to the manager's success in gaining confidence and trust. 2. Strong communication and interpersonal skills. Volunteers are typically seeking openness and interpersonal relationships in their work and expect reciprocal behavior from their manager. 3. Ability to create clearly defined goals and objectives for the volunteers. Having a set of goals and expectations will help both the manager and the volunteer to stay focused and optimize the available resources. 4. Project management skills are a must. Deploying volunteers is only part of the work. Overseeing the ongoing work to ensure expectations are met is critical and a project plan and timeline will enable the manager to succeed in overseeing the multiple projects

performed by volunteers.

15 United Way of Massachusetts Bay and Merrimack Valley 7 5. Flexibility in deploying and allocating resources. Volunteers are not paid employees and cannot be treated the same way. They need to be allowed more flexibility in order to retain them. However, there is still a job to be done and the manager needs to be flexible in identifying options and opportunities. 6. Excellent listening skills to enable them to understand the wants, desires, and needs of the volunteers. Volunteers want to add value and if they do not believe they are being heard and utilized effectively, they will move on to another organization. 16 In other words, volunteer managers are basically human resource managers for people who are not getting paid to do important work. Therefore they need to have appropriate training and ongoing professional development in the area of volunteer management. They also need to help train and support other staff in their agency who will be working with the volunteers so they too have (at the minimum) basic volunteer management skills. We have experienced this first hand within our United Way 2-1-1 service. With the need for more volunteers and continued training and development of volunteers, we have placed a greater emphasis on having a staff person trained as our volunteer manager. We have also provided training for all staff on volunteer management skills so that everyone can provide the support and environment that makes people want to volunteer with us….and to continue to volunteer with us! How other United Ways have integrated best practices to mobilize volunteers in meaningful ways

United Way of Greater Portland (Maine) – Skill-based volunteering Best Practices: Developing personal and professional skills On their local Day of Caring, United Way of Greater Portland partners with area marketing, advertising and design professionals to bring local non-profits free marketing and advertising advice. Agencies participate in 90-minute one-on-one sessions of personalized, pro-bono advice with a team of marketing, media, PR, design and event planning professionals. In 2009 to date, 85 skilled volunteers have assisted over 30 partner agencies. United Way of the Greater Seacoast (Portsmouth, NH) – alignment with Impact Areas Best Practices: Giving back to an important issue and personal satisfaction United Way of the Greater Seacoast’s Volunteer Center worked with their partner agencies to develop new volunteer opportunities that aligned with their Impact areas. Over 60 new opportunities were created and are now featured on their website. Volunteers are able to see where the greatest needs are and how they can make a direct impact on the most critical issues facing their community. United Way of Rhode Island – Short-term project focused on an Impact area Best Practices: Providing a sense of accomplishment and feeling of personal satisfaction United Way of Rhode Island’s Volunteer Center identified five summer learning programs the desperately needed supplies for their summer education programs. By having a specific goal and partnering with the local companies and volunteer groups they were able to collect all the supplies needed for these programs.

16 Susan Ellis – Energize Inc. a national training consulting and publishing firm 8 IV. Local research A. Data – scope & dimension

The Corporation for National and Community Service conducted a study called Volunteering in America which contains many interesting statistics and trends in volunteerism. In addition to showing national trends, the data is broken down by states, major-size cities and selected midsize cities. Madison is one of the mid-size cities on which they report. Here is some of the local information from that study. 41.5% of Madison residents volunteer (compared to the national average of 27%) placing Madison 4 th within mid-size cities surveyed in United States. Madison residents volunteer an average of 36.3 hours/resident placing Madison close to the national average, but 42 nd among mid-sized cities in the U.S. 17

17 CNCS – Volunteering in America 20099 B. Community engagement United Way of Dane County promotes volunteerism in a number of important ways. 1. Days of Caring - For the past seventeen years, we have kicked-off our annual fundraising campaign with Days of Caring. This countywide volunteer event began with 125 volunteers in 1993, and has grown to a record number of 3,139 volunteers in 2009. The more variety of and quality of projects, size of projects, locations, and date/times we have, more volunteers will participate. Giving new and exciting ideas to partner agencies has given a variety of opportunities to volunteer teams and individuals over the years. In 2009, the

Volunteer Center developed new strategies to involve more organizations, groups, and individuals and give quality experiences to all volunteers during Days of Caring. These strategies include: • Focus on increasing agency participation - Although we strive to have additional agencies participate in Days of Caring, this is only of value when the projects at the agencies are meaningful. Therefore as we seek to add more agencies to participate in Days of Caring, we will also work with them to ensure that their projects are appropriate and will provide volunteer teams with a positive experience. • Cerebral, or “Brains vs. Brawn” projects - By offering these opportunities, volunteers are able to share their business skills with nonprofits. This could be reviewing marketing materials, reviewing personnel policies or doing a space analysis. • Large scale Volunteer Team coordination – o Born Learning Trails – In 2009, we installed twelve trails in parks throughout Dane County that provide fun learning activities for children and their parents/caregivers. Volunteer teams of 15-20 installed the trails (over 200 volunteers total) making a lasting legacy for early childhood development in our communities. o Specific project assistance/coordination to large group teams • We matched over 700 employees from American Family Insurance and over 260 employees from Oscar Mayer/Kraft Foods to Days of Caring projects. • A “Camp United Way” theme to engage people not only in the day-of volunteer activity, but energizing them to take what they learned and share it with others • More follow-up and technical assistance to agencies regarding project development. Better communication between agencies and team leaders is also needed to ensure that volunteers are prepared for the work they will be doing and the agency knows that they will have the people power they need to get the

work done. When we asked team leaders about the quality of the types of projects available this year, 73% rated the choices as Very Good or Excellent.

2. VolunterYourTime.org – This website is a five-agency collaboration (partners with United Way are UW-Madison Morgridge Center for Public Service, Madison Area Technical College (MATC), RSVP of Dane County and Edgewood College) which is the local one-stop for volunteering in Dane County. Currently, the website lists 293 agencies and 753 opportunities allowing 24/7 access to volunteer opportunities throughout Dane County. VolunteerYourTime.Org Registered Volunteers Unique Visitors Average Unique Visitors per Month 2007 1,869 45,002 3,750 2008 2,857 39,344 3,279 2009 (to date) 2,212 35,822 3,582 10 3. We have experience in effective targeted volunteer recruitment for a variety of opportunities and time commitments. Long-term • Schools of Hope – When we started Schools of Hope, an article in the newspaper put out the call for volunteer tutors for K-3 grade. We were hoping for perhaps several dozens calls the day the article ran…instead we had over 400! 60% of volunteers stay in the program from year to year and we recruit about 40% new volunteers. So this would mean that about 900 stay and 600 are recruited every year.

• United Way 2-1-1 volunteers -- United Way 2-1-1 volunteers are key to the provision of our service. In order to provide a high quality service and keep volunteers’ skills up, they receive 25 hours of training and are asked to make a weekly commitment for one year. Over the past year, we have experienced more complex calls coming to 2-1-1 which involves more volunteer training, supervision, ongoing skill development and continuous training. More time for volunteer management has been designated to one staff person’s job and all staff receive training on effective volunteer management practices. Volunteers at United Way 2-1-1 19 21 24 16 18 13 0 5 10 15 20 25 30 2007 2008 2009 Volunteers during the year

Additional volunteers during Thanksgiving Basket Special project • Health Access Pilot – In 2005/2006 HAP was a pilot program with United Way and the local Healthcare Council. The purpose of this program was to reduce emergency room usage for non-acute care by the uninsured. Volunteers were recruited as Family Health Navigators to assist clients with accessing resources and providing transportation to medical appointments at primary healthcare homes. Fifteen volunteers applied and six were assigned to patients. Short-term • United Way 2-1-1 – During the floods in 2008, 2-1-1 was the number to call for information on resources available to flood victims and how people could volunteer to help. Over the course of one week, 198 volunteers responded to help. One time • For our 2009 Days of Caring, we added some new strategic opportunities for volunteers including sponsoring and installing Born Learning Trails and using volunteers “cerebral” (i.e. business) skills to strengthen agencies’ efficiencies. Even though this was a tough economic year for many companies and individuals, we had a record number of volunteers that participated - 3,139 a 22% increase over 2008! By adding these new ways to be engaged, more people found their niche and wanted to be involved. United Way 2-1-1 Total Volunteer Hours 0

10 20 30 40 50 60 70 2007 2008 2009 Total Volunteers Number of Hours per Volunteer on Average 200911 V. Hypothesis and goal Dane County residents are committed to volunteerism, but need to do so with greater frequency and longevity to accelerate our success on Agenda for Change goals. We need to raise community awareness of the need for volunteers to advance the Agenda for Change; we need them to feel “asked” to volunteer and for them to know that they can make a meaningful contribution to solving a crucial community concern. We need to increase outreach to a larger and more diverse pool of potential volunteers to expand the talent pool of volunteers. We need to train nonprofit agencies in best practices with regard to volunteer management to improve their ability to recruit, match, train and retain volunteers. These strategies will result in an increase in the number of people who volunteer and the average number of hours of service by these volunteers. Our goal is to increase the number of hours of volunteer service each year in Dane County from 16,767,950 in 2008 to 17 million by 2015.

Achieving this goal would come from a combination of increases in the number of volunteers and increases in the number of volunteer hours. Below is a chart that illustrates possible ways that we may achieve our goal. Number of volunteers Average number of hours served during the year per volunteer Total volunteer hours Baseline 2008 191,700 87.5 16,767,950 193,000 88.1 Scenarios for reaching our goal in 2015 194,285 87.5 17 million (232,050 more volunteer hours) Combined hypothesis/goal statement: By raising awareness of the need for increased volunteerism to solve critical community problems, increasing outreach to a larger and more diverse pool of potential volunteers, and improving volunteer management practices to recruit, match, train and retain volunteers, we can increase the number of hours of volunteer service each year in Dane County to 17 million by 2015. VI. Strategies Our three strategies are to:

• Raise awareness of the need for increased volunteerism to accelerate success on the Agenda for Change, • Increasing outreach to a larger and more diverse pool of potential volunteers, and • Improving volunteer management practices to recruit, match, train and retain volunteers. We propose the following tactics: A. Raise awareness of the need for increased volunteerism to accelerate success on the Agenda for Change 1. Develop and promote volunteer opportunities for each Agenda for Change area Timeframe to begin Identify ways volunteers can make the greatest impact in each Agenda for Change area 1 st and 2 nd quarters 2010 Work with agencies to develop these opportunities where they don’t exist 3 rd -4 th quarter 2010 and into 2011 Promote opportunities to targeted markets Start 3

rd and 4 th quarters 2010 12 B. Increasing outreach to a larger and more diverse pool of potential volunteers 1. Expand the diversity of leadership volunteers Timeframe to begin Provide opportunities and information to (especially) young professionals and diverse populations on how and why to serve on a board or committee 2010 2. Facilitate increased corporate volunteerism Timeframe to begin Present opportunities to Business Volunteer Network (BVN) members related to the Agenda for Change Ongoing Provide technical assistance to companies that are interested in developing or enhancing employee volunteer programs Start 3 rd quarter 2010 Work with agencies to develop meaningful ways for companies and their employees to be involved through volunteerism that meet both the needs of

both the companies and the agencies 2011 3. Develop youth leadership and increase youth engagement Timeframe to begin Reach out to youth through schools, youth groups, faith-based organizations, neighborhood centers, etc to encourage and facilitate increased volunteerism 2011 Develop a presentation portfolio and engage youth/young leaders as trainers/presenters to reach out to their peers 2011 Work with agencies to develop more – and more interesting – opportunities for youth engagement including leadership opportunities related to best practices in volunteer management 2011/2012 Through Youth Service Day: • ensure youth understand and directly experience the relevance of their work • let them know how they can continue to volunteer • measure their satisfaction with their Youth Service Day and interest in continuing to volunteer 2010 2010

2010 C. Improving volunteer management practices to recruit, match, train and retain volunteers. 1. Teach best practices in volunteer management Timeframe to begin Enhance Volunteer Center staff’s expertise in effective volunteer management practices 2010 and 2011 Provide technical assistance to agencies related to best practices in volunteer management 2010 13 Teach best practices in volunteer management (continued) Develop Peer-to-Peer learning series for experienced volunteer managers to facilitate sharing of best practices, critical thinking skills and the development of new ways to involve volunteers Spring/Summer 2010 Provide quality and relevant training and networking opportunities such as conferences, Lunch N Learns, facilitated discussions, etc 2010 (in partnership with Dane County Administrators of Volunteer Services/DCAVS) Offer and refresh as needed our Professional Development for Nonprofit Managers series

Offer 4 th series in 2010 Refresh in 2011 Increase “library” of resources – in-house, on-line via website and VolunteerYourTime.org 2011 2. Position the Volunteer Center as the premiere local resource on volunteerism Timeframe to begin Know and share (with agencies, the community, our volunteers, etc) the research related to volunteerism 2011 Be knowledgeable about and, as appropriate, engaged in national, regional programs, promotions, etc related to volunteerism. 2010 Enhance VolunteerYourTime.org website to highlight meaningful opportunities and other relevant information related to volunteerism 2010 Use social media in effective ways to reach a wider audience 2010/2011 Have volunteers referred through us or participating in volunteer events we do (DOC, YSD, etc) feel a

stronger connection to our United Way. 2010 Recognize the impact of volunteerism on the Agenda for Change through the Community Volunteer Awards 2010 The specific tactics for each of these strategies will be developed once we have the go ahead from the Board on whether we are on the right track in terms of hypothesis, goals and strategies. A finalized list will be presented at the January Board meeting. VII. MEASURES We will use the Corporation for National and Community Service (CNCS) report on volunteerism to track our success in meeting the goal to increase volunteerism. This report was the source for the baseline value of our metric: 41.5% of Dane County residents volunteer; each volunteer contributes an average of 87.5 hours. We will also track the following metrics: • Volunteer service towards Agenda for Change Mobilization Plan initiatives. • Local youth participation in Youth Service Day, By Youth For Youth and the President’s Volunteer Service award. • Days of Caring volunteer involvement and feedback • VolunteerYourTime.org statistics o Unique visitors o Feedback surveys o New opportunities and agencies registered o Matches through Board Match • Company retention and new members in Business Volunteer Network (BVN) • Attendance and feedback from training participants.

The logic behind Indian FMCG companies acquiring foreign companies is based on many economic theories. The following article touches upon a few important ones. GLOBALISATION

One of the fundamental concepts behind firms expanding their market outside of their domicile country is to take advantage of the encouraging demand and supply conditions abroad. These favourable supply-demand market situations could be with respect to goods, services, knowledge, resources, goodwill or information, or a combination of them. Knowledge sharing is perhaps the key characteristic of globalisation. For instance, by acquiring Hobi in Turkey, Dabur has taken advantage of the Turkish company's knowledge on the domestic market. To explain, Dabur has eliminated the cost of acquiring information on legal aspects, resource availability, and domestic demand and supply conditions associated with starting the production of hair care products in Turkey. So, instead of venturing out to set up a plant from scratch and begin production, Dabur has bought a company which already has a “sheltered” market. In the process, the Indian company has eliminated the cost of time and resources involved in generating a stable revenue stream. Sometimes, it is more profitable to sell products directly in foreign markets than acquire local companies with existing customer base. Two of the important reasons for this is the cost of acquisition, and uncertainty in returns. An example in this regard is Marico, which sells variants of its “Parachute” brand directly in West Asia, Bangladesh and Nepal. Similarly, another important aspect of globalisation is the ease with which technological know-how can be transferred across companies in different geographies. Godrej's acquisition of Rapidol in South Africa is a fitting example. If Godrej discovered that Rapidol was following a cost-effective process, it would then be able to apply the same methods in its domestic factories. RISK DIVERSIFICATION

Basic consumer economics theory suggests that risk-aversion is an innate utility-based human behaviour. And reasons behind cross-country acquisitions of firms are not very different in that regard. Termed “defensive strategy” in managerial economics, similar sized companies merge in anticipation of changes in demand patterns, import composition and other production-related factors. Demand distortions are likely to occur in the FMCG segment, mainly because of the nature of the goods. For instance, if the competitor of, say, Vatika hair oil, is able to decrease its cost of production and pass it on entirely to its customers, then users of Vatika are very likely to switch to the competing product. Also, product differentiation is not pronounced in such types of goods. To explain, olivebased body soap cannot be very different across brands, which makes substitutability that much easier compared to other goods. INDIAN ECONOMIC CONDITION

The Indian economy is fraught with profound issues in recent times such as depreciating currency, stubborn inflation, and decelerating economic growth. These are some factors that affect both the demand and import patterns, which in turn influence mergers and acquisitions.

Mergers and Acquisitions have been very common incidents since the turn of the 20th century. These are used as tools for business expansion and restructuring. Through mergers the acquiring company gets an expanded client base and the acquired company gets additional lifeline in the form of capital invested by the purchasing company. Recent mergers and acquisitions authenticate such a view. The Long Success International (Holdings) Ltd merged with City Faith Investments Ltd on the 8th of April 2008. The value of the merger was US $3.2 million. The agency in this instance was Bermuda Monetary Authority, Hong Kong Stock Exchange and other regulatory authority that was unspecified. Novartis AG acquired 25% stake in AlconInc. This acquisition was worth 73,666 million common shares of the company. They bought this stake from Nestle SA for $10.547 billion by paying $143.18 for every share. It was a privately negotiated transaction that needed to have a regulatory approval. Simultaneously, Novartis AG also received an offer of 52% interest that was equivalent of 153.225 million common shares of Alcon Inc. Kinetic Concepts acquired each and every remaining common stock of LifeCell Corp for $51 for each share. Their total offer was $1.743 billion. The deal was done in accordance to regulatory approvals and the conventional closing conditions. Kapstone Paper & Packaging Corp acquired the kraft paper mill as well as other assets of MeadWestVaco.Corp. They paid them $485 million. The deal was conducted as per the regulatory approvals, receipt of financing and conventional closing conditions. This deal included a lumber mill in Summerville, hundred percent interest in Cogen South LLC. The Chip mills in Kinards, Elgin, Andrews and Hampton in South Carolina are also parts of this deal. Petrofalcon Corp acquired the remaining shares of Anadarko Venezuela Co fromAnadarko Petroleum Corp. The deal was worth 428.46 million Venezuelan bolivar or US $200 million. The deal was completed as per the regulatory approvals. Discover Financial Services, LLC acquired Diners Club International Ltd from Citigroup Inc. The deal was worth US $165 million. The deal was subjected to regulatory approvals and normal closing conditions. Cobham PLC took over MMI Research Ltd. The deal was worth ?16.6 million or $33.099 million. In this deal ?12.2 was paid in cash, ?1.4 million in loan notes and almost ?3 million in payments related to profits. WNS (Holdings) Ltd from India, took over the total share capital of Chang Ltd. The deal was worth ?9.6 million. Of this amount ?8 million was to be paid in cash and the rest was to be paid in payments related to profits.

AptarGroup Inc acquired the Advanced Barrier System wing of the CCL Industries Inc. The deal was worth almost 9.4 million Canadian dollars. The entire amount was paid on cash. Varian Inc from USA took over 23% stakes of Oxford Diffraction Ltd. The deal was worth ? 4.6 million pounds. ? 3.5 million was paid in cash, and the rest was to be paid from the profits made by the company. Spice PLC took over Melton Power Services Limited. The deal was worth ?4.5 million. ?2.5 million was paid in cash and the rest was to be paid from the profits made by the company. Spice PLC also got Utility Technology Ltd., GIS Direct Ltd, and Line Design Solutions Ltd as part of the deal. Atlas Iron Ltd. Took over a 19.9% stake in the Warwick Resources Ltd. This was equivalent of 15.124 million new common stock of the Warwick Resources Ltd. They paid A$ 3.781 million in a transaction that was privately negotiated. The transaction was executed as per the approval from the shareholders. The selling price of the shares was A$ 0.23 and it was based on the value of each share that stood at A$ 0.25 on 4th of April 2008. Republic Gold Ltd of Australia took over the remaining stocks of Vista Gold (Antigua) from Vista Gold Corp. The deal was worth $3 million. Republic Gold also got the Amayapampa project in Bolivia as a part of the deal.Manpower Software PLC took over Key IT Systems Ltd. The deal was worth ?0.83 million. ?0.375 million was paid in cash and the rest is supposed to be paid from profits. Spice PLC took over Utility Technology Ltd. The deal was worth ?0.2 million – ?0.1 million was to be paid in cash and the rest was to be paid from the profits. As part of this deal Spice PLC also acquired Melton Power Services Ltd, GIS Direct Ltd and Line Design Solutions Ltd. Spice PLC took over Line Design Solutions Ltd and GIS Direct Ltd. The total deal was worth ?0.1 million and the entire amount was paid in cash. Spice PLC also acquired Utility Technology Ltd and Melton Power Services Ltd as part of the deal. Thomas Cook Group PLC acquired Elegant Resorts Ltd from Barbara Catchpole and Geoff Moss. Australian Social Infrastructure Fund merged with API Fund. The deal was subjected to regulatory approvals and shareholder. Greenbier Cos Inc took over Roller Bearing Industries Inc., from AB SKF. Fijian Holdings Ltd has took over 50.2% interest in RB Patel Group Ltd. Honeywell International Inc has acquired Norcross Safety Products LLC from Odyssey Investment Partners LLC. The deal was worth $1.2 billion. It was subjected to various kinds of regular closing conventions and regulatory approvals.

bout International Mergers and Acquisitions

International mergers and acquisitions are growing day by day. These mergers and acquisitions refer to those mergers and acquisitions that are taking place

beyond the boundaries of a particular country. International mergers and acquisitions are also termed as global mergers and acquisitions or crossborder mergers and acquisitions. Globalization and worldwide financial reforms have collectively contributed towards the development of international mergers and acquisitions to a substantial extent. International mergers and acquisitions are taking place in different forms, for example horizontal mergers, vertical mergers, conglomerate mergers, congeneric mergers, reverse mergers, dilutive mergers, accretive mergers and others. International mergers and acquisitions are performed for the purpose of obtaining some strategic benefits in the markets of a particular country. With the help of international mergers and acquisitions, multinational corporations can enjoy a number of advantages, which include economies of scale and market dominance. International mergers and acquisitions play an important role behind the growth of a company. These deals or transactions help a large number of companies penetrate into new markets fast and attain economies of scale. They also stimulate foreign direct investment or FDI. The reputed international mergers and acquisitions agencies also provide educational programs and training in order to grow the expertise of the merger and acquisition professionals working in the global merger and acquisitions sector. The rules and regulations regarding international mergers and acquisitions keep on changing constantly and it is mandatory that the parties to international mergers and acquisitions get themselves updated with the various amendments. Numerous investment bank professionals, consultants and attorneys are there to offer valuable and knowledgeable recommendations to the merger and acquisition clients.

Methods of Financing International Mergers and Acquisitions Usually, the following methods are implemented for funding international mergers and acquisitions:



Financing (or taking loans)



Cash



Factoring



Hybrid Financing Significant International Mergers and Acquisitions

Following are the instances of the major international mergers and acquisitions:



The merger of British Petroleum (BP) with Amoco (erstwhile Standard Oil of Indiana)



The acquisition of Mannesmann AG by Vodafone Airtouch PLC



The merger of Exxon with Mobil (The name of the company formed as a result of the merger is ExxonMobil)



The acquisition of AirTouch Communications by the Vodafone Group



The acquisition of Compaq by Hewlett-Packard



The acquisition of Shell Transport & Trading Company by Royal Dutch Petroleum Company



The merger of Bank One Corporation with JPMorgan Chase & Company Factors Affecting International Mergers and Acquisitions The following elements influence the international mergers and acquisitions from many aspects:



Corporate governance



Company acts



The capacity of average workers



Expectation of the consumers



Political features of a country



Tradition and culture of a country

Acquisition Of Companies And Brands - Fmcg Sector Posted By: Nitin Kochhar on 4/26/2006 at 5:54 AM

300 Points

Hi, We have seen Mergers and Acquisition in FMCG sector as well as acquisition of lot individual brands. Here are few examples: 1. 2. 3. 4.

P&G and Gillette Dabur acquired Balsara for 143 crores Godrej Consumer Care bought Keyline Brands Marico acquired HLL Nihar brand

I have done some research on this topic. I want the following inputs: a) Rationale for companies going for acquistions (strategy)

b) Please give more examples of acquisition of companies and brands c) Do you forsee any future acquisitions in FMCG globally or in India? If yes, what is the rationale behind this? Any type of help will be useful. Thanks and Regards, Nitin Kochhar

Read more: http://www.marketingprofs.com/ea/qst_question.asp?qstID=12949#ixzz2A6zjOgCt there was one sector that saw furious action on the mergers and acquisitions (M&A) front this year, it was fast moving consumer goods (FMCG). Data from advisory firm Grant Thornton shows the growth in M&A deals this year was 16 times more in comparison to last year. The total value of deals last year was $47.9 million. In 2008, the value of these deals was even lower, at $34 mn, so when compared with 2010, the growth is over 23 times, says Grant Thornton.

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Compared to 2007, a boom year, the growth in value of transactions this year was 34 per cent, says Grant Thornton. The value of deals in 2007 was $596.6 mn versus $797.8 mn (Rs 3,630 crore) this year. However, the growth in volume of deals was marginal this year over 2007, at 34 registered to 32 then. In contrast, 2009 saw 12 M&A deals and 2008 saw 10 deals. “There has, no doubt, been a rebound in activity levels this year. Companies which had postponed M&A activity in the past two years were clearly making up for the lost time,” says Srividya C G, partner, advisory services, Grant Thornton. A significant contributor to the growth registered this year were outbound deals — domestic companies making acquisitions abroad. These were worth $506.9 mn vis-a-vis $45.5 mn registered in 2009 and $2 mn registered in 2008. In 2007, outbound deals were $266.9 mn.

Expansion Most mid-tier FMCG companies such as Dabur, Marico, Godrej Consumer and Emami were snapping up companies or brands this year to expand their sphere of activity. GCPL did five outbound deals and one domestic deal this year, emerging as the most aggressive of the lot. Rivals Dabur and Marico were next in line with two outbound deals, respectively. GCPL Chairman Adi Godrej says the acquisitions were in line with its global three-by-three strategy, to grow in the regions of Asia, Africa and Latin America in the areas of home care, personal wash and hair care. “We have been following a very disciplined and focused approach to identifying acquisitions that represent a strong fit with our business, both strategically and operationally.” This was on display when the company quietly acquired Mumbai-based Priya Kothari group’s Swastik and Genteel brands for under Rs 50 crore. Company watchers and analysts were caught by surprise when the company made the announcement earlier this month, indicating it could shift its attention from international deals to domestic deals if required. “We are open to the prospect of more domestic acquisitions provided it makes strategic sense to do so,” says Godrej. GCPL and other home-grown majors had expressed interest in Ahmedabad-based Paras Pharmaceuticals, which finally went to Reckitt Benckiser. The Paras deal, at eight times sales and 30 times earnings before interest, tax, depreciation and amortisation, was unprecedented in an industry where deals are normally three to four times sales.

FMCG DEALS OVER THE LAST FOUR YEARS Volume FMCG, Food & Beverages

Value ($ million)

2007

2008

2009

2010*

2007

2008

2009

2010*

Inbound

7

3

2

1

300.87

23.84

-

35.00

Outbound

5

2

4

18

266.91

2.00

45.50

506.89

Crossborder

12

5

6

19

567.78

25.84

45.50

541.89

Domestic

20

5

6

15

28.84

8.13

2.44

255.93

Total M&A

32

10

12

34

596.62

33.97

47.94

797.83

Source: Grant Thornton; *from January to December 15

But the high valuation of local assets is what is driving homegrown companies abroad, say analysts. Sunil Duggal, CEO, Dabur Ltd, agrees as much. He says, “Valuations abroad are not stretched, especially in the personal care space.” Dabur’s two outbound deals this year were in the personal care arena. Duggal says expanding abroad is a geographical hedge against the domestic market. The latter is increasingly getting competitive with the entry of new players, especially multinational companies. “International markets contribute about 25 per cent to our turnover. This should grow over time.”

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FMCG biggies in acquisition-valuation fix Published: Tuesday, May 15, 2007, 3:29 IST By Sindhu Bhattacharya

NEW DELHI: Are acquisitions the key to growth for fast-moving consumer goods (FMCG) companies? The answer will be different for different companies. With many FMCG biggies still facing limited pricing power, steadily rising input costs and moderate near-term growth projections, analysts have begun looking at mergers and acquisitions (M&As) as a panacea for inducing robust growth in the FMCG business. A look at the operating margins of the four biggies — Hindustan Lever Ltd (HLL), Dabur India, Godrej Consumer Products Ltd (GCPL) and Marico - make it clear that each company has seen margins fall in the January-March quarter this year. And analysts are prescribing a simple remedy: acquisitions. Sample this: While analysing the healthy growth numbers reported by leading FMCG company Dabur India, Citigroup analysts

observed that “overall growth remains strong, we believe that current valuations … at the higher end of Dabur’s historical trading band cap re-rating potential for the stock. As such, we also do not see any near-term re-rating triggers, with the exception of a potential acquisition.” Not only Dabur, even HLL is seen facing intense competitive pressure. Analysts at Merrill Lynch recently pointed out that with ITC expected to enter the soaps and shampoo categories in the near future and Procter & Gamble likely to launch its skincare business in India, HLL must brace for tougher times ahead. “This implies a tougher competitive outlook for HLL… Margin outlook is dismal. We expect HLL’s margin to remain under pressure, owing to steep raw material inflation, likely new competition from ITC and P&G, and management plans to rebuild its foods business,” Merrill said. This is perhaps why some FMCG firms are seeing some truth in advice of increased inorganic growth. GCPL, for example, bought UK-based Keyline Brands and then Rapidol hair colour brand last year. Marico acquired two soap brands in Bangladesh, another in the home market and Nihar hair oil business from HLL. And Dabur India has also been on the look-out. Hoshedar K Press, executive director and president, GCPL, remains committed to acquisitions as a way to grow his business. “Hair colour is an area where we would like to make more acquisitions.” What’s important here are the reasons for a company acquiring any other company or business? For instance, for Marico, acquiring Nihar hair oil business from HLL would mean further strengthening its market leadership position and building further on scale advantages. On the other hand, GCPL’s acquisition of Rapidol, UK’s hair colour business in South Africa had a different intent. It provided company access to a large ethnic hair colour market, brands and also a springboard for the introduction of its other products in South Africa and neighbouring markets. And notably, all that in a profitable way — Rapidol was a profit making entity. Hence, what an acquisition means for a company is important to understand. Acquiring companies for the sole purpose of sustaining growth rates may also not help unless and until the acquisition fits well with the company’s strategic growth plans and vision. For the time being, the high valuations are also a big hurdle and are spoiling the M&A party for FMCG companies. Deepankar Sanwalka, executive director at KPMG, avers that the FMCG sector does need economies of scale. “But this need not necessarily come through M&As… given the current trend of high valuations for target companies, too much money is chasing too few brands. Companies need to figure out whether acquisitions would give them the necessary scale or is building own brands a more viable option”. So, the business also needs to come at the right price. Dabur, despite being on the look-out for a suitable acquisition target, appears to have come across repeated roadblocks over the last two years, mainly due to exorbitant valuations. So, FMCG companies need to work out ways of solving this acquisition-valuation riddle in order to generate higher growth rates. Meanwhile, there are other prudent ways of improving margins as well as sustaining growth rates. Says an analyst with a foreign brokerage: “I prefer process improvement and volume growth as better margins levers rather than acquisition. It is the onus of the market leader to drive the category growth, which would increase volumes. And then there is always a case to increase efficiencies and cut costs by better operational processes.” He avers, “Looking at the valuations, an acquisition is like buying topline, which is not very healthy.”

Mergers and Acquisitions Intro At the beginning of the 21st century the future of the beverage and food industry seemed to be unclear. With a slow growth rate of only 2% per year, food and beverage companies were desperately seeking the ways to enhance sales and profits. Many companies such as Kellogg's, Sara Lee, Quaker Oats and

others considered merging to be a solution and thus the turn of the 21st century was marked by $ 30.5 billion worth of mega-mergers . One of the largest mergers was the merger between PepsiCo and Quaker Oats which occurred on August 2,2001. This biggest strategic decision PepsiCo Corporation ever made added not only the necessary boost in sales needed to attain tremendous growth, but also positioned company as a dominating force in the food and beverage industry. Detailed analysis of this decision, its impact on productivity and cost is presented below. Analysis In order to understand clearly the motivating factors of this decision, it would be useful to describe the nature and position of the two companies on the global market arena prior to the merger. Quaker Oats was formed in 1901 in Raven, Ohio by joining several oat-milling companies. Before the merger, 92% of Quaker Oats' U.S. brands held number one and number two positions in their respective categories. However, throughout its life, Quaker frequently tried itself in non-food industry, which all weakened the company's greatness and left little worse off. The primary reason was that Quaker could not handle the scale of big corporation. The biggest strategic decision that followed by a huge success was acquiring the rights to sell Gatorade, as it captured 84% of the sport drink market. In 1994, Quaker bought rights to sell Snapple, but the result was much worse than expected. Quaker bought Snapple for $1.7 billion and sold it in 1997 for $300 million, making a net loss of $1.4 billion . Due to this huge fiasco, Quaker could not survive independently any more and needed a financial bailout. Merger with PepsiCo was considered to be a solution and in the beginning of December, 2000 Quaker sealed the deal. The transaction was done in exchange of shares – 2.3 PepsiCo shares/1 Quaker Oats share, thus leaving the deal tax-free. A North Carolina pharmacist Caleb Bradham founded PepsiCo in 1890 as a beverage company. Throughout its history, PepsiCo developed and acquired many different products, merged with Frito-Lay Snack Company, bought Tropicana in 1998 that was one the smartest strategic decisions. Currently PepsiCo has revenues of about $27 billion and over 143,000 employees in over than 200 countries. Over the years PepsiCo has been competing with its major rival Coca Cola for being the leader in carbonated soft drinks in the marketplace, as it was the favorite choice of consumers. However, in recent years market conditions have changed and due to health trends, customers' attention turned to non-carbonated beverages. Demand for non-carbonated drinks increased significantly. It had a stable sales growth of 8% - 9% a year in comparison with 2% - 3% of carbonated beverages. This condition explained where the major profit could be made. Before the merger, PepsiCo portfolio of non-carbonated beverages included Lipton teas, Tropicana juices and Aquafina water. Gatorade was worth of attention and despite Quaker's financial difficulties, commanded over 84% of the sport drinks market . It made clear that acquiring Quaker Oats would make PepsiCo a leader on the non-carbonated beverages market. That was one of the reasons to seal the deal between two corporations. Gatorade was not the only interest of PepsiCo. On the contrary, Quaker Oats snack line, including granola bars, rice snacks, fruit and oatmeal bars perfectly completed an existing successful line of PepsiCo's Doritos and Tostitos corn chips. That gave two companies an ability to extend their pool of consumers. Quaker Oats and PepsiCo completed each other not only in terms of their products but also in advertising strategy. PepsiCo strategy known as "Pepsi Generation" created an image that Pepsi products are for the youth market. Similarly, Gatorade was the product with greater impact on younger customers. From marketing point of view Gatorade perfectly fitted into PepsiCo's portfolio of products. Merger between PepsiCo and Quaker Oats created important cost savings. Due to the similarities of each company's products, the distributional needs were close to each other. Merging with the major suppliers' channels of PepsiCo gave Quaker Oats additional benefits and savings. Warehouse forces were also combined that enabled to save time, space and manpower. Beverage manufacturing for Pepsi-Cola, Tropicana and Gatorade has been also consolidated, that gave operational benefits and valuable cost savings. Economies of scale resulted because certain components that comprise more than one of the beverages would be able to be produced on a larger scale. Thus, PepsiCo and Quaker now share warehouses and distributing system. It is the most important reason why this merger meets all cost

savings needs. Latest releases show that PepsiCo reduced its costs from $400 million annually to $230 million . PepsiCo and Quaker Oats combined its forces not only in terms of production but also in terms of human capital. Pepsi allowed for the entire Quaker's management team to come to Pepsi to run Quaker's business. These managers have been responsible for Quaker's success before the merger through their rich experience. Pepsi wanted to keep that track and was relatively satisfied with the management and organization of the business in Quaker Oats before the merger. Thus, PepsiCo did not have a necessity to invest huge sums of money in improving the system and was just getting benefits from the additional asset the merger has provided. In combining their resources, PepsiCo and Quaker Oats save money and increase efficiency. All major criteria for raising productivity are met. Physical capital and human capital are combined. Costs from operations are significantly reduced. Increasing returns to scale are applied. Result? Joy of merging! Conclusion Merging with Quaker Oats gave PepsiCo a strong, strategic and competitive product portfolio. Quaker Oats' Gatorade enables PepsiCo to be one of the leaders in non-carbonated beverage industry. Quaker Oats' snack line that is known as healthy wholesome eating completed the portfolio of salty and unhealthy food, produced by Frito-Lay, subsidiary of PepsiCo. PepsiCo allows Quaker Oats to keep its identity that is one of the most important factors of disagreement companies face with after merging. All these issues outline a winning merger, one that created $ 25 billion corporation that is the fifth largest in the country.

Merger problem-no problem I have documented in the previous paper for this class my beef with the authors: that they have a readymade set of excuses absolving workers of all of the blame for downward spirals in productivity - rather, it‟s the cold sterility of computer technology, or mergers, or globalization, or cost-cutting, or reengineering, or outsourcing, or some combination of the above that is to blame for the unraveling of the corporate culture as we know it. In the words of Charlie Brown, “Good grief.” Perhaps it‟s because I‟ve never been a part of a strong, warm workplace culture, but I believe that the authors underestimate the value of just coming in, doing your job, and not worrying about having a social life or friends at work, and not carrying on about awful the employment landscape is today. Those things are all nice and might be life-affirming and lend "meaning" to a person's life, but doing the job is paramount to all of the above. (It's not politically correct to point this out.) Again, I want to reiterate a point I made in the previous paper: a job is a privilege, not a right. There is no more “right” to a job than there is a “right” to win the lottery. I am a terribly lucky, blessed person to have the job that I have, and I work for someone who has the reputation of being an absolute monster at times. But we have gotten so carried away with assigning rights we have no business assigning, rights that the recipients have no business having ascribed to them, that we forget that responsibilities are also involved. The concept of "rights without responsibilities" leads to anarchy, and virtual anarchy is the condition found in many factories and other places of employment today. And the fact that so many people have conspired to legitimize the crap put forth by the two authors - from the publishers to the universities that assign “The New Corporate Cultures” as a text - makes me wonder if the world has not lost its collective head. That said, the authors do make some good points about Merger Mania (the topic of Chapter 5) and its effect on organizational cultures, but they don‟t offer solutions to the problems; rather, they tend to harp on the fact that the sacred employee is harmed in some way by the merger/ acquisition process. But several models exist that can facilitate more winners in the merger game than shouting, "Damn the torpedoes, full speed ahead" does. Cultural differences between the partners of a merger are one of the common reasons for the failure of

the merger to succeed. The term "corporate culture" is often used to describe issues like objectives, personal interests, behaviors, and so forth; problems with cooperation and teamwork are often blamed on the culture of a company. But in a merger, the term "culture" means much more than making sure that the people from both merger partners work together in a smooth fashion. The problem in mergers is that people from very different organizations and cultures are expected to work together, to discuss, and to solve complex strategic and operative tasks. It is difficult to impose a new culture that doesn't have the people's acceptance. But the development of a new, shared culture is critical to the merger's success, and it's possible to manage the process in a structured way. Mergers and acquisitions succeed and fail according to how well cultural issues and differences are addressed, and how quickly a unified culture emerges post-merger. Oliver Recklies put forth a checklist of steps to follow when considering mergers and their effect on corporate culture. First, during the pre-merger phase, develop a strategy for cultural integration; decide if you want to go on with one of the existing cultures or if you prefer an integrated culture (which I'll touch on in a little bit). Second, analyze and describe the existing cultures, for differences and common elements can show up only in direct comparison, as can the identification of cultural barriers, communication differences, and other potential problems. Third, decide on the role that the new culture should play in the new organization; why did you choose that particular culture, and what do you want to achieve with it? Fourth, establish "bridges" between both companies in order to achieve mutual understanding and cooperation. Fifth, establish a basis and mechanisms for the new culture, including a supporting system of rewards (and, unfortunately, sanctions). Lastly, be patient; people take time to be acquainted to a new cultural reality (2001). When first studying the possibility of a merger, analysts undertake what is known as due diligence. A proposed merger or acquisition can be devalued or scrapped depending on conflicts over intellectual property rights, personnel or accounting discrepancies, not to mention incompatibilities in integrating information technology systems. Researching, understanding, and if possible, avoiding these risks is known as due diligence (Copeland, 2000). When undertaking a due diligence study, one should take all of the reasonable steps to ensure that both sides get what they expect and not a lot of things that were not counted on or expected. Yet one of the main obstacles to the success of many mergers - the potential compatibility or lack thereof between the cultures of the companies being merged - could also be conquered during the due diligence phase if company heads would take the time to see if they were mixing oil and water. Instead, most players in the merger game focus instead on things like strategic business development, operations, marketing, sales, and finance. Cultural cohesion often gets short shrift. Regardless, many companies forge ahead toward Mergerland without doing a complete due diligence study. But there is still hope for these companies, if they truly have an eye toward integration (as opposed to merely devouring the acquired company without regard for the consequences). While perfect integration is rarely achieved, in which both cultures form to combine one new culture, the ideal situation is to bring the best elements of both cultures into the new organization. Avoiding the complex organizational issues that mergers bring about is key to making this happen. A smooth transition into the integration process, not to mention the smooth implementation of the process itself, can be determined by how well you manage the change. A merger is often called “the mother of all change management initiatives,” (The L Group, n.d.) because it is truly a multi-headed monster. These “heads” include aggressive financial targets that must be achieved, short timelines in which to succeed, intensive public scrutiny (including competitors rooting you on to fail), cultural clashes, changes related to growth, restructuring, reengineering, retention problems, and politics and positioning. But in order to effectively manage this cultural upheaval, several steps can be taken for managers of merging entities, especially those in the "acquiring" company: * Address “self” issues quickly - that is, it‟s important that you can answer when the employees ask you, “What‟s in it for me?” The “me” questions are questions that employees will keep answering until they get

an answer. * Be sure that clear leadership is applied; avoiding the concept of "two-headed monsters" (telling employees one thing while doing another) and taking a "back-to-business" approach can help ease the minds of affected employees. * Communicate early and often; in a situation like a merger or an acquisition, the most frightening message is silence. * Make the tough decisions. The merger/acquisition process is not unlike pulling off a bandage. It can be slow and painful, or it can be quick and painful. Either way, it's inevitable that there will be good people hurt by this process. * Manage employee resistance early, instead of letting their low morale infect others on the team. There are three major causes of employee resistance, both active and passive. If the employee is unwilling to put forth the effort to help the merger succeed, performance management in the way of goals and rewards can help. If the employee is unable to put forth the effort due to ignorance of the new rules of the game, training must be a big part of the process. If the employee doesn't know his role and what's to take place, the use of communication can overcome that hindrance (The L Group). As silly as it might sound, another important step in the establishment of a new culture can be found in the name of the new organization, which can take a key role in the process. The new name can be a symbol for the changes that come along with the merger, and it indicates how much both old companies contribute to the new one. For instance, in the Citicorp-Traveler's merger, the new name was Citigroup, which kept part of the Citicorp name and gave the impression of "lessening" Traveler's importance to the merged entity. Conversely, the merger between Daimler-Benz and Chrysler gave us the company known as Daimler-Chrysler; while Chrysler's name was in the new company, the new name left no question as to who was pulling the strings. Further, the Grand Metropolitan-Guinness merger spawned the name Diageo, and while that's not an actual word, the name also gives the sense that "we are a new company, where Grand Metropolitan and Guinness are on equal footing." It also helps to remember that, as I stated earlier, there is rarely a perfect integration of the merged companies. Fewer than half of the companies who try to create a new culture are successful in doing so (Recklies, 2001). It's important for the dominant culture to be reinforced; this can be done through such diverse methods from the implementation of rules and policies, to the use of rewards and recognition, to the use of ceremonies and events, to the actual behavior of leadership at this time. It's necessary to coordinate all other elements that influence culture, such as reward systems and systems for performance measurement. Organizations that want to integrate both old cultures need to ensure that neither partner gets advantages or disadvantages. In order to avoid an "us versus them" mindset, it is advisable to form new teams with people from both organizations. Only then will everybody realize that inevitable changes are on their way. Of course, the glue that binds everything together during the merger/acquisition process is the usage of open and honest communication. Communication through the integration should be a top priority, and should be honest, proactive, two-way and consistent from all sources. Newsletters, hotlines, workshops, surveys, questionnaires and feedback analysis are all ways to keep the lines of communications open. I have never been part of a company that was taking part in the merger/reacquisition process during my employment there. The contractor I work for was once known as Comarco before SAIC bought it in the early part of this decade. The only reason I know this is because I found some old documentation on Comarco letterhead in our library. Those are the only vestiges of Comarco's existence here; SAIC has swallowed it whole. From what I gather, the players in my department are the same people who were here during the Comarco days, so SAIC's purchase of Comarco had a negligible effect, if any, on the team. In summary, the rules for cultural implementation of a merger can be put forth in two sentences. First, to impose an unwanted culture is a good solution in very few cases. Second, the integration of cultures is much harder to achieve, but in the long term, they promise much better results. In addition, Recklies' last

entry on his checklist - patience - is equally key to the success of any merger. If the desired results don't show up immediately, that's not a reason to pull the plug on the deal. People take time to become acclimated to a new culture, and if they are high performers, there's no reason they can't help pull it off in due course; unfortunately, we are so driven by short-term success anymore that patience is often a fourletter word. References Copeland, Lee (2000). Due diligence. Retrieved June 5, 2005, from http://www.computerworld. com/news/2000/story/0,11280,42836,00.html Recklies, Oliver (2001). Mergers and corporate culture. Retrieved June 5, 2005, from http://www.themanager.org/Strategy/Merger_Culture.htm The L Group (n.d.) Indigestion vs. integration: Realizing the promise of a merger through effective human capital strategies. Retrieved June 5, 2005, from http://www.thelgroup.com/p_TheLetter/3.asp

Company mergers Company mergers and the effect on employees and consumers. Context: · Employees · Management · Consumers Direction: · On-line research (On-line Magazines, News Groups) · Human Resources Why the topic is important: · Mergers have affected our group, and it is a growing trend in the American businesses today. Relevant Terms: Merger A merger is achieved when a company purchases the property of another firm, thus absorbing them into onecorporate structure that retains its original identity. Consumer Consumers are everyday people who buy goods for personal use. Consumers have the right to question object and boycott companies who are not in their best interest. Culture Company culture is the DNA of an organization, not always visible, but it controls the form and function of such elements as decision making, communication style, reward and recognition methods, reporting hierarchies and leadership values. A lot has been written about the financial aspects of merging companies. Less attention has been focused on the human element. More and more firms risk similar fates as the nation continues to experience a boom in mergers and acquisitions. Last year there were 11,655 domestic mergers and or acquisition deals for a staggering $1.6 trillion, according to Securities Data Company, a research organization in Newark, NJ The number of deals has more than doubled since 1990, when 5,654 transactions were reported. In most merger and acquisition cases, the parties involved follow a well-established mating ritual called due diligence, which allows them to explore the merits of the marriage. Behind the scenes, lawyers, accountants and high-priced financial analysts join with top executives to make sure the move is strategically and financially smart.

Although predicted synergy‟s point to handsome profits down the road, when the earnings reports start rolling in, the outcomes are often disappointing. Seven out of ten mergers and acquisitions do not live up to their financial promise. Forty seven percent of the acquired executives leave in the first year; and seventy five percent leave in the first three years, according to Mark Herndon, regional service leader, mergers and acquisitions, at Watson Wyatt Worldwide in Dallas. The major cause of failure may have nothing to do with the financial or legal details that have been so carefully ironed out between accountants and lawyers. “People think that if you do the financial deal, the soft and squishy stuff will fall into place,” says Tom Davenport, a partner at Towers Perrin in San Francisco. “Not true. It‟s the soft and squishy stuff that will make or break the deal.” After understanding the steps for a merger, the major considerations associated with a firm's culture are the chemistry or compatibility of the individuals and do they share a common philosophy of how to do business. Stating the common goals for two or more diverse groups is a lot easier than achieving those goals. Cultural goals such as quality client service and teamwork are generally common to most firms, but how they achieve those goals may differ dramatically. To determine if potential mergers complement one another and if a common operating culture exists a these questions must be addressed: · How do partners show their commitment to quality client service? · Are there major differences in the compensation systems of the respective firms, as to partners' earnings and staff salaries? · What are the work ethics prevailing in each of the firms? · What are the competencies of personnel? Are they comparable? · Do the available technical resources in each firm complement one another? · What is the turnover rate for staff and administrative personnel? · Have there been partner departures, voluntary or involuntary? · Are there any client specialties or special services? · How comparable are the average total hours worked, as well as chargeable and billable for like personnel categories? · How does the investment in computers, office equipment, and other office facilities compare? · What direction is the marketing effort taking, how much is being spent, and are there any benchmarks? Is a merger still a merger when the respective sizes of the firms are ninety percent and ten percent? Is it just an acquisition, where the ten percent should quietly accept the culture of the ninety percent? Whether you call it a merger or an acquisition, each firm has its own culture, and the smaller entity, if substantially different from the one around it, will continue to survive as a discordant subculture, unless an effort is made to integrate all the players. Frequent mergers leave little opportunity for establishing a value-added firm culture. The surviving firm's culture is absorption, which sooner or later like overeating will probably be self-destructive. If we truly believe that people are our most important asset we need to treat them that way. A merger or an acquisition gives us an opportunity to do well by our people by being honest with them, keeping them in the loop, and giving them all the information we can as early as we can. Get people in both the merging company and the company being absorbed together as early as possible. Discuss the issues that were the perceived potential benefits behind the merger openly and frankly. If Company A's strength is sales and they are absorbing Company B in part because of B's distribution capabilities, make sure A's distribution people know to listen to B's distribution people and B's sales force understands the opportunity to learn from A. You probably need to reduce the number of people. Cost savings through combining redundant tasks is a common goal for mergers. The trick is to release the individuals least equipped to contribute in the new organization and to hold on to the best people. Make sure the evaluation of “best” looks at both companies' people equally. After all, you don't want to lose a great person from Company B so you can keep a mediocre person from Company A.

Be honest with people. We all appreciate frankness. We may not like to find out that our job is going away, but we would much rather hear it up front than to find out when we get our two weeks notice from someone who has been telling us all along our job is “safe”. Merging two companies with their different policies, procedures, and culture will create stress for all the people involved. The survivors from both companies will have to deal with new people, new procedures, possibly more work, and the loss of previous coworkers and friends. Be realistic in your work flow planning. Plan for people to be less productive than normal as they deal with the changes. Expect to lose some good people who are not comfortable with the new organization. Give yourself and your department time to work through the changes and get back up to full speed.