Managing the IT Integration of Acquisitions by Multi-Business Organizations

Acquisitions are standard components of the growth strategies of many organizations. Frequently, acquisitions raise important questions concerning how and to what extent the acquisition’s information technology (IT) needs to be integrated into the IT of the acquirer. We investigate how the initial conditions of business and IT alignment in the acquirer and the acquisition affect the complexity of the post-acquisition IT integration process, in acquisitions of business units by multi-business organizations. Adopting an IT alignment model for multi-business organizations, we explain the complexity of IT integration paths in two acquisitions made by the industry group Trelleborg AB. We identify four initial business and IT strategic alignment conditions where the IT integration process is a simple one-step process exploiting existing business and IT capabilities. Low compliance with these conditions leads to increased complexity because additional business and/or IT capabilities have to be developed to leverage the full potential of the acquisition

Managing the IT integration of acquisitions by multi-business organizations

Acquisitions are standard components of the growth strategies of many organizations. Frequently, acquisitions raise important questions concerning how and to what extent the acquisition’s information technology (IT) needs to be integrated into the IT of the acquirer. We investigate how the initial conditions of business and IT alignment in the acquirer and the acquisition affect the complexity of the post-acquisition IT integration process, in acquisitions of business units by multi-business organizations. Adopting an IT alignment model for multi-business organizations, we explain the complexity of IT integration paths in two acquisitions made by the industry group Trelleborg AB. We identify four initial business and IT strategic alignment conditions where the IT integration process is a simple one-step process exploiting existing business and IT capabilities. Low compliance with these conditions leads to increased complexity because additional business and/or IT capabilities have to be developed to leverage the full potential of the acquisition

Experience Spillovers across Corporate Development Activities

This study develops a theoretical explanation for the existence of positive, as well as negative, experience spillovers across corporate development activities. We suggest that the similarity in two activities influences both the sign and magnitude of experience spillovers. The argument is used to understand how alliance experience influences the performance of acquisitions in the US commercial banking industry. The empirical evidence indicates that the spillover effect of alliance experience on acquisition performance is a function of the decisions made in the post-acquisition phase regarding the level of integration and the replacement of top management. We also find a U-shaped relationship between alliance experience and acquisition performance, suggesting the presence of negative spillovers across corporate development activities at low experience levels.

A Risk Management Model for Merger and Acquisitio

In this paper, a merger and acquisition risk management model is proposed for considering risk factors in the merger and acquisition activities. The proposed model aims to maximize the probability of success in merger and acquisition activities by managing and reducing the associated risks. The modeling of the proposed merger and acquisition risk management model is described and illustrated in this paper. The illustration result shows that the proposed model can help to screen the best target company with minimum associated risks in the merger and acquisition activity

The choice of insider or outsider top executives in acquired companies

There is considerable debate amongst academics and practitioners over whether top executives of acquired or merged companies should stay or go, post-deal, as studies exploring the link with organisational performance show mixed results. This may in part be due to such studies failing to recognise that there are a number of distinct post-acquisition strategies which may require the deployment of different types of top executive. This paper addresses this limitation by bringing together the longstanding Insider/Outsider debate with a post-acquisition integration framework, in order to investigate whether there is a link between top management type and post-acquisition integration strategy. Using a dual methodology of survey and cases drawing on UK M&A data, clear associations are found between top executive type and particular post-acquisition styles. Underlying these patterns, the value-creating/value-capturing distinction of the Resource-Based View appears to have a greater influence over top executive deployment than do issues of Organisational Fit. This suggests strategic intentions have ascendancy over organisational constraints in the selection of top executives for managing post-acquisition integration

The Impact of Knowledge Codification, Experience Trajectories and Integration Strategies on the Performance of Corporate Acquisitions

This study addresses the following questions: (1) can organizations learn how to manage infrequent and heterogeneous tasks ? (2) If they can, then what are the mechanisms that might explain learning under these circumstances ?, and (3) what are the limitations under which these mechanisms operate ? A model based on explicit knowledge codification and tacit experience accumulation is submitted and tested using data from a sample of 183 acquisitions in the US banking industry. Measures of post-acquisition integration strategies and of pre-acquisition resource characteristics are included in the model. We find that tacit knowledge accumulation significantly impacts performance when the experiences are highly homogeneous, and that knowledge codification improves acquisition performance in the context of high post-acquisition integration, i.e. when the organizational challenge is particularly complex. Also, the level of integration between the two firms involved in the acquisition positively influences performance, while the replacement of top managers in the acquired firm impacts performance in a negative fashion. Implications are drawn for organizational learning theory and for a knowledge-based view of corporate acquisitions.

Managing continuity: dealing with the experience of being target in a take-over.

Based upon literature on innovation and strategy, the experience of being target in a take-over is studied from a process perspective at a local office of the acquired parent company. Through a case study the impact and importance of the management of continuity provided by the local management is illustrated.

Reconsidering translation and language in an international business context: beyond an instrumental approach.

International;

From M-form to N-form: The Structure of Multinational Corporations

The purpose of this study is to map, illuminate and explain the recent development of the strategies, structure and control of multinational corporations. The aim is to identify crucial problems in managing and organizing multinational corporations and describe what sort of approaches are used and proposed to solve these problems. This is a literature study where an inventory and critical examination of the recent research on the strategies, structure and control of multinational corporations. The emphasis in the study is on research carried out in the last ten years. It starts out with a summary of the early research on multinational corporations, proceeds to an analysis of the process school, and ends up with a discussion about organizing international operations from a network perspective.MNC; multinational structure; international; strategy; transnational; subsidiary; global

The Knowledge Application and Utilization Framework Applied to Defense COTS: A Research Synthesis for Outsourced Innovation

Purpose -- Militaries of developing nations face increasing budget pressures, high operations tempo, a blitzing pace of technology, and adversaries that often meet or beat government capabilities using commercial off-the-shelf (COTS) technologies. The adoption of COTS products into defense acquisitions has been offered to help meet these challenges by essentially outsourcing new product development and innovation. This research summarizes extant research to develop a framework for managing the innovative and knowledge flows. Design/Methodology/Approach – A literature review of 62 sources was conducted with the objectives of identifying antecedents (barriers and facilitators) and consequences of COTS adoption. Findings – The DoD COTS literature predominantly consists of industry case studies, and there’s a strong need for further academically rigorous study. Extant rigorous research implicates the importance of the role of knowledge management to government innovative thinking that relies heavily on commercial suppliers. Research Limitations/Implications – Extant academically rigorous studies tend to depend on measures derived from work in information systems research, relying on user satisfaction as the outcome. Our findings indicate that user satisfaction has no relationship to COTS success; technically complex governmental purchases may be too distant from users or may have socio-economic goals that supersede user satisfaction. The knowledge acquisition and utilization framework worked well to explain the innovative process in COTS. Practical Implications – Where past research in the commercial context found technological knowledge to outweigh market knowledge in terms of importance, our research found the opposite. Managers either in government or marketing to government should be aware of the importance of market knowledge for defense COTS innovation, especially for commercial companies that work as system integrators. Originality/Value – From the literature emerged a framework of COTS product usage and a scale to measure COTS product appropriateness that should help to guide COTS product adoption decisions and to help manage COTS product implementations ex post