Group processes, intergroup relations and human resource practices in mergers and acquisitions post-combination: A critical review and research agenda for the future

Abstract

Despite ongoing crisis and recession, mergers and acquisitions (M&As) are used by companies to reinforce and sustain their place in business world. Regardless of M&As popularity, though, the successful integration of employees’ merging partners and the effective management of the relationships between them and with their merged organization, remains a major challenge not frequently considered during merger process. In this respect and related to the above, the present paper by critically reviewing new research within M&As, attempts to provide a comprehensive integrative review based on the essentials and implications of the social psychological theories of group processes and intergroup relations as represented by the Social Identity Approach (SIA) and related to intergroup structure, fairness, legitimacy and leadership procedures, accompanied by the description of the knowledge-based view (KBV) of M&As which focuses on knowledge integration and capabilities transfer during post-combination. In that way, it aims to reflect on pre-and post-M&A important contextual and process merger success factors (i.e. micro-behavioural and macro-organization/strategy perspectives). Also, based on significant insights drawn from empirical findings discussed, our review seeks to translate them into practical implications for organizational practice and explore promising issues and directions that could expand our understanding and managing of merger integration efficiently.