Unveiling the myths of M&A integration : challenging general management and consulting practice

Bauer, Florian and Hautz, Julia and Matzler, Kurt (2015) Unveiling the myths of M&A integration : challenging general management and consulting practice. Journal of Business Strategy, 36 (2). pp. 16-24. ISSN 0275-6668

Abstract

Purpose - The purpose of this paper is to detect and challenge generally accepted management and consulting practice in Mergers & Acquisitions (M&As). M&As have been an important issue in strategic management and corporate development for decades. The integration process of two separate entities has been found to be of importance, and has, accordingly, received a significant amount of attention by research, management and consulting literature. Based on these insights, managers tend to rely on well-established and generally accepted rules developed by practice and consultants that should support a successful integration process and the generation of value. Nonetheless, M&As' efforts still often fail to create value. So is the common practice of the established drivers and beneficial consequences of the integration of M&As right, or do the experiences of consultants, companies and managers reveal something different? Design/methodology/approach - To understand these challenges, the authors spent four years studying M&A projects and subsequent integration processes of more than 400 companies that engaged in M&A efforts. The data derived from four survey-based quantitative studies among more than 430 CEOs, CFOs and other senior managers in the field of M&As and personal interviews that were conducted to get in-depth insights. Findings - This extensive research on the efforts and projects of M&As over many years and including many companies reveals that successful integration processes are complex, social and culturally dependent endeavors and that the application of commonly accepted and established principles oversimplifies and disregards the interdependencies. Originality/value - The present paper unveils four established principles concerning the successful integration after M&As as tenacious myths and provides more differentiated insights into value-destroying and value-creating mechanisms in M&As. [ABSTRACT FROM AUTHOR]