Ofra Sherman And The Glaxo-Wellcome Merger

With the merger of Glaxo-Wellcome, Wellcome-Hallas manager Ofra Sherman found herself in an interesting predicament. With uncertainty as to whether she answered to Wellcome or Promedico, she needed to find a way to keep her staff informed and motivated amidst uncertainty of their future. With minimal information, she needed to decide who she was going to answer to, what she was going to tell her employees, and ultimately what direction she was going to take her team in the aftermath of the merger.
How did Glaxo-Wellcome handle the merger? Prior to the Glaxo-Wellcome merger, Wellcome’s management had been assured that the company’s shares were secure and would not be sold off without lengthy discussion between management and shareholders (Jick & Peiperl, 2011). When the shares were suddenly sold to Glaxo in 1995, it caught management completely off guard.
Sherman’s situation was complicated by the fact that she had a third party, Promedico corporation, which also claimed the services of her and her team. The lack of a plan for the merger and lack of transparency as to how the company would ultimately be reorganized negatively affected the initial success of this merger. Nguyen and Kleiner (2003) found that merger success is directly correlated to the level and quality of planning involved. Furthermore, most merger failures occur in the integration phase, due to lack of communication or lack of a clear vision (p. 447). In this case, Glaxo-Wellcome owed its employees a clear plan as to how they would be reorganized and what their role would be in the new