The article "How does decision-making involvement affect perceptions of speed during post-merger integration?" by Mark Thomas (ICN Business School) and Nathalie Louisgrand (Grenoble Ecole de Management) was published in the European Management Journal.
There is a misconception in the world of mergers and acquisitions (M&As) that employees can accurately judge the speed at which the post-deal integration occurs. This article demonstrates the opposite. It then discusses the implications of such erroneous perceptions.
A two-and-a-half-year longitudinal study of two merging organizations was conducted. During that time, the authors rigorously tracked how long key integration changes took to make and to implement. They spent more than 60 hours interviewing senior and junior management. They then assessed the perceptions of different employees for each decision made, particularly regarding the time taken to implement the change. The results are surprising and have significant consequences for how the speed of post-deal integration should be managed.
In fact, choosing the speed of integration is generally recognized as one of the most important decisions that an organization needs to make once the M&A deal has been completed. Integrate too slowly and customers may lose confidence in the firm. This can lead to reduced sales and growth opportunities. Integrate too quickly and knowledge transfer and potential synergies may be lost. Employee confidence in the organization may equally diminish. This can lead to reduced morale and resignations by key employees. Thus, aligning perceptions of integration speed to the reality is a key managerial proficiency to ensure efficient post-deal integration. This article offers critical insights into how this challenge should be addressed.
Find the article here.