Edited by Pietro Mazzola and Franz W. Kellermanns
Chapter 18: A Review of Research Progress in Understanding the Acquisition Integration Process: Building Directions for Future Research
Annette L. Ranft, Frank C. Butler and Jennifer C. Sexton Mergers and (M&As) acquisitions play a major role in corporate strategy as evidenced by the $1.45 trillion spent on M&A activity in the United States in 2007 alone (Mergers and Acquisitions Report, 2008). Despite the preponderance of continued acquisition activity, traditional financial, strategic, and organizational perspectives of M&As have failed to explain the generally disappointing value created by these corporate events (King et al., 2004; Larsson and Finkelstein, 1999; Pablo et al., 1996). Scholars have increasingly emphasized the importance of the post-acquisition integration process, where ‘the actions of management, and the process of integration, determine the extent to which potential benefits of the acquisition are realized’ (Birkinshaw et al., 2000: 397). Indeed, it is during the acquisition integration process that potential synergy in an acquisition is realized (Larsson and Finkelstein, 1999). A major challenge then, for both managers and scholars, is to identify and manage integration processes that can lead to post-acquisition success. While there is a rich body of research on mergers and acquisitions,1 research specifically examining process issues during acquisition integration is more limited and somewhat disjointed. A theoretical process perspective of acquisitions was developed and introduced by Jemison and Sitkin (1986). This perspective considers the overall acquisition process as a series of decisions and behaviors from early stages of the due diligence phase, to deal construction, to the post-deal integration phase. Subsequent process perspectives focused on fundamental dimensions of the acquisition integration phase...
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