Employee commitment in the post-acquisition integration process: The effect of integration speed and leadership

Abstract

Summary We draw on a behavioural decision making framework and the M&A and leadership literatures to examine the effect of post-acquisition integration speed and leadership on the commitment decisions of employees to stay with acquired target firms during the integration process. We propose that fast integration motivates employees to stay, and that effective leadership can enhance this effect. Drawing on conjoint analysis and data on 2912 commitment decisions nested within 91 employees, we find that fast integration has a positive effect on employees’ motivation to stay with the firm, and that the more the leadership style of their supervisor is characterized as relational, contextual, inspirational, supportive, and stewardship-based, the stronger this effect of fast integration. We discuss implications of our work for the M&A literature.