Signaling strategic commitment for organizational transition: how to manage potential M&As through voluntary disclosures

To ‘transit or not’ often depends upon winning over investor opinion to large strategic initiatives. M&A is one such major realignment of an organization and yet once a bid for a company has been announced there is a period of uncertainty when the bid may not be completed. This depends on share price movements determined more by investor perceptions than fundamental values. This paper investigates whether these perceptions may be influenced by ‘voluntary’ corporate communications and so link managerial practices to strategic outcomes. Drawing upon two very large M&A data sets (USA and UK) (57,000 deals; 30,000 communications) we argue managerial practice (signaling strategic commitment) shapes market response and demonstrate communication characteristics, and the use of high-reputation intermediaries, play an important role in determining share price reaction

Voluntary disclosures as a form of impression management to reduce evaluative uncertainty during M&A

This study develops and tests a set of hypotheses on how to manage investors’ evaluative uncertainty during M&A through a specific form of impression management, namely, interim news events. We suggest that voluntary disclosures are key in influencing investors’ reactions during M&A. Empirical support for our theoretical arguments is shown in a sample of 36,376 deals and 163,023 associated interim news events carried out by NYSE and NSDQ listed organizations over 10 years. Our research contributes to literature on voluntary disclosures, impression management, and managing M&A

Why good things don’t happen:the micro-foundations of routines in the M&A process

Why do organizations reject favorable opportunities - why don't good things happen? To address this question, we examine companies that fail to proceed with major opportunities for strategic renewal. By focusing upon routines in 28 cases of reverse mergers and acquisitions decisions across three continents, the research uncovers the centrality of a hitherto overlooked process, the authorization routine. The characteristics of this routine, and its nested nature, are shown to be critical to whether favorable opportunities are progressed. These findings contribute to the mergers and acquisition literature by extending prior process models and to the routines literature by showing how links and interactions between different layers of routines, and the nature of the routine enactment itself, are important in affecting strategic outcomes

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Recasting the dynamics of post-acquisition integration:an embeddedness perspective

M&A scholars have generally assumed that post-acquisition integration is a self-contained process. However this ignores that this process rarely unfolds as the only ongoing initiative in an organization. We contend that post-acquisition integration is not detached from other simultaneous change processes in the organizational context and this has important implications for our understanding of how integration dynamics actually evolve. To further understand this embeddedness we examine the unfolding of a post-acquisition integration process in a company faced with an unanticipated drop in demand due to the global economic crisis. Through a qualitative, longitudinal study conducted over three years, we carried out 151 interviews to uncover the unfolding of the post-acquisition process. We find that post-acquisition integration is embedded in a set of co-evolving processes. We highlight four mechanisms (coordination, cohesion, disconnection, alienation) that arise from the co-evolution of processes that either facilitate or impede integration. Our findings contribute to our understanding of post-acquisition integration dynamics by recasting the integration process as embedded in a set of co-evolving processes that shape its unfolding

Multidexterity:combining competing business models in transforming economies

In an attempt to respond to recent calls for better understanding the coexistence of multiple business models, we develop the concept of ‘multidexterity’— the ability to develop, nurture, and execute several distinctive BM strategies simultaneously across different levels and functions of the MNC and its host markets. To illustrate this approach, we describe a European healthcare firm entering the rapidly transforming economy of China and facing regulatory constraints and ambiguities in the application of industry standards. This situation is a generic challenge for MNCs entering rapidly transforming economies, which they help in turn to substantially alter and develop. We argue multidextrous business models are effective entry strategies for MNCs. They also help resolve two conceptual limitations in the BMI literature: (1) the problem of environmental contingencies and (2) the interrelatedness of factors at the macro, meso and micro levels. We address these problems from a practice approach. We provide some implications for the concept of multidexterity and business models, and address managerial challenges and prospects in developing multidextrous organizations

Problematizing Strategic Alliance Research: Challenges, Issues and Paradoxes in the New Era

Strategic alliances have attracted substantial attention from industry and academia over the past three decades. However, due to rapid technological evolution, saturated marketplaces, globalisation of businesses on the one hand and de-globalisation of the market on the other (as marked by Brexit and the trade war between US and China, COVID-19 pandemic and the Ukraine war), the strategic environment of businesses is changing quickly. Fundamental and rapid changes in the wider environment necessitate the review of theoretical and practical insights of earlier and emerging studies - to examine the new challenges, issues and paradoxes of strategic alliances. This special issue attempts to provide a forum to allow researchers to question the assumptions underlying existing theory a little further beyond just “gap-spotting” or “gap-filling”. This special issue includes four very interesting literature review pieces, which venture deeper into the phenomenon, and explore the opportunities, issues and paradoxes of strategic alliances while adopting alternative theoretical perspectives, methodological approaches and interpretations to address issues of managing strategic alliances and maximising returns from them in the new strategic context

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

That’s great on paper… but not in practice! – A routine ecology perspective to understand M&A integration barriers.

Building on the endogenous routine dynamic perspective, we aim to understand the micro-foundations of capability transfer in post-acquisition integration. Based on a single, longitudinal case study of an acquisition in the consultancy sector, we apply a practice-based lens to study the intended combination of two existing routines in an acquisition process and why its implementation turned out to be a failure. Our findings suggest that seemingly matching capabilities were not compatible in practice as the underlying sequences of action were incompatible and their embeddedness in its intra- and inter-organizational ecology of routines was not considered. Our article sheds light on the role of routines in acquisition integration and contributes to literature by discussing a) the prevailing role of the interconnectedness of routines in effective capability transfer and b) discrepancies between ostensive and performative aspects of routines as impediments to the implementation of the pre-acquisition plan in the post-acquisition phase