Communication Processes and Merger Success

Abstract

This study examined in three phases whether managerial communication processes differ in more and less successful mergers. In Phase 1, employees at four recently merged financial institutions were interviewed, and published accounts of mergers were reviewed to develop several broad hypotheses regarding how managerial communication activities (participative, supportive, informative, and directive) influence merger success during each stage of merger implementation. Next, criteria were established to assess the human resource dimension of merger success, and an instrument was developed to identify two more and two less successful recently merged financial institutions. In Phase 2, the hypotheses were tested, using a pattern matching multiple case study. None of the four managerial communication processes consistently occurred more frequently in the more successful mergers. In Phase 3, several contingencies were identified which appear to influence the communication needs of employees in acquired organizations. These relate to particular merger stages, settings, message characteristics, and inferences about communicators.