Acquisitions

Full Answer Section Whether the acquisition will result in increased strategic competitiveness for the acquiring firm: It is too early to say whether the acquisition of Activision Blizzard will result in increased strategic competitiveness for Microsoft. However, there are several reasons to believe that it could. First, the acquisition would give Microsoft a significant market share in the gaming industry. This would allow Microsoft to compete more effectively with other gaming companies, such as Sony and Tencent. Second, the acquisition would give Microsoft access to Activision Blizzard's intellectual property. This would allow Microsoft to develop new games and expand its gaming business. Third, the acquisition would give Microsoft a stronger position in the cloud gaming market. This would allow Microsoft to offer more cloud gaming services to its customers. Which problem do you believe is the most critical in the global economy? Why? The most critical problem that affects the success of an acquisition in the global economy is cultural integration. When two companies from different cultures merge, it can be difficult to get the two cultures to work together effectively. This can lead to problems such as employee turnover, decreased productivity, and lost market share. What should firms do to ensure they do not experience such a problem when using an acquisition strategy? There are a number of things that firms can do to ensure they do not experience cultural integration problems when using an acquisition strategy. These include:

• Conducting a cultural due diligence: This involves assessing the cultural fit between the two companies before the acquisition is finalized.
• Creating a clear integration plan: This plan should outline how the two cultures will be integrated after the acquisition is finalized.
• Communicating effectively with employees: Employees from both companies need to be kept informed about the acquisition and the integration plan.
• Providing training and support: Employees from both companies need to be provided with training and support to help them adjust to the new culture.

By following these steps, firms can help to ensure that their acquisitions are successful.

Sample Answer Acquisition: Microsoft's acquisition of Activision Blizzard Firms' characteristics and experiences: Microsoft is a large technology company that develops and sells software, hardware, and cloud-based services. Activision Blizzard is a video game publisher that owns popular franchises such as Call of Duty, World of Warcraft, and Candy Crush. Reasons cited to support the acquisition: Microsoft cited several reasons for acquiring Activision Blizzard, including:

• To expand its gaming business: Microsoft is the second-largest gaming company in the world, behind Tencent. The acquisition of Activision Blizzard would make Microsoft the largest gaming company in the world.
• To gain access to Activision Blizzard's intellectual property: Activision Blizzard owns a portfolio of popular video game franchises. Microsoft believes that acquiring these franchises will help it to grow its gaming business.
• To strengthen its position in the cloud gaming market: Microsoft is a leader in the cloud gaming market. The acquisition of Activision Blizzard would give Microsoft access to Activision Blizzard's cloud gaming technology.