Table of Contents

Handbook of Research on Mergers and Acquisitions

Handbook of Research on Mergers and Acquisitions

Elgar original reference

Edited by Yaakov Weber

For the last four decades, researchers in various disciplines have been trying to explain the enduring paradox of the growing activity and volume of mergers and acquisitions (M & A) versus the high failure rate of M & A. This Handbook will stimulate scholars to focus on new research directions.

Chapter 5: The dynamics of knowledge transfer in mergers and acquisitions

Paulina Junni, Riikka M. Sarala and Eero Vaara

Subjects: business and management, corporate governance, organisational behaviour, strategic management, economics and finance, corporate governance

Extract

Mergers and acquisitions (M & A) are a popular means to enter new markets, access new resources and transfer knowledge (Ahuja and Katila, 2001; Haspeslagh and Jemison, 1991; Vermeulen and Barkema, 2001) despite the fact that acquisition outcomes are often disappointing (King et al., 2004). While acquisition performance is affected by a large number of variables, one of the key determinants is knowledge transfer (Birkinshaw et al., 2000; Haspeslagh and Jemison, 1991) – defined as the level of utilization of the source’s knowledge by the recipient (Minbaeva et al., 2003). Through knowledge transfer, the merging firms create value by accessing new knowledge that resides in the acquisition partner or from combining the resources of the two firms in new ways (Capron and Pistre, 2002; Eschen and Bresser, 2005). Regardless of the importance of knowledge transfer in M & A, relatively few studies have examined the complex mechanisms that impact knowledge transfer in this context (for exceptions see for example Björkman et al., 2007; Ranft and Lord, 2002; Sarala and Vaara, 2010; Westphal and Shaw, 2005). In particular, there is a lack of integrative models that spell out how key mechanisms facilitate or impede knowledge transfer in general (Kane, 2010), and in acquisitions in particular (Haleblian et al., 2009). This is what we aim to provide in this chapter. We portray post-acquisition knowledge transfer as a dynamic process, which ultimately relies on organizational absorptive and disseminative capacities that depend on knowledge complementarity, operational and cultural integration, and political behavior.

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