Managing the Post‐acquisition Integration Process: How the Human Iintegration and Task Integration Processes Interact to Foster Value Creation

Abstract

The paper reports a study of the post‐acquisition integration process in three foreign acquisitions made by Swedish multinationals. Detailed interview data and questionnaire responses in both acquiring and acquired firms are presented. The sub‐processes of task integration and human integration are separated out and it is shown that effective integration in these cases was achieved through a two‐phase process. In phase one, task integration led to a satisficing solution that limited the interaction between acquired and acquiring units, while human integration proceeded smoothly and led to cultural convergence and mutual respect. In phase two, there was renewed task integration built on the success of the human integration that had been achieved, which led to much greater interdependencies between acquired and acquiring units.

The motives and performance of cross-border acquirers from emerging economies: Comparison between Chinese and Indian firms

“…The organizational culture of bidders and targets is also important in determining the ease of access to new product and consumer markets. For instance, sociocultural factors such as mutual respect and trust make cross-border post-acquisition capability transfer and resource sharing easier (Birkinshaw, Bresman, & Håkanson, 2000;Stahl & Voigt, 2008). We argue in this paper that Chinese MNEs face higher liabilities of foreignness (or cultural disadvantages) than…”

“…Moreover, if we look at Hofstede's (1980) cultural dimensions, India has a smaller score than China on the masculinity-femininity (MAS) dimension, suggesting that India is a more feminine society than China. Feminine societies encourage the building of trust and empathy within organizations (Hofstede, 1980) and existing evidence shows that the creation of trust improves synergy realization within cross-border M&As (Birkinshaw, et al, 2000;Stahl & Voigt, 2008).…”

“…CD_MAS is the least correlated with DEVELOPED, representing the best alternative to test for the fast entry hypothesis in India. Moreover, this measure captures the potential impact of femininity on cross-border M&A synergies and performance (Birkinshaw, et al, 2000;Stahl & Voigt, 2008).…”

“…the same language), the international transaction has less obstacles and more chance of rapid success (Buckley, et al, 2012). Moreover, India is characterized as a feminine society (small MAS score), and when targeting other feminine countries (with a small cultural distance on MAS), bidders are able to further improve the realization of M&A synergies (Birkinshaw, et al, 2000;Stahl & Voigt, 2008). Thus shareholders recognize the cultural advantage of Indian MNEs as an accelerating factor in the race for accessing new markets and strategic assets.…”

Integration Management of Western Acquisitions in Japan

“…Following Birkinshaw et al (2000), we divided the post-acquisition integration process into organizational integration (task integration) and human integration (employee resistance). Whereas organizational integration deals with the operational integration of the firms, human integration analyzes the (mostly negative) reactions of employees towards M&A integration, and methods of managing these reactions.…”