Managing change after the merger: the value of pre-merger ingroup identities

Abstract

Purpose– The purpose of this paper is to examine the role that pre-merger identification plays within a post-merger setting. Social Identity Theory (SIT) has conflicting reports on the role that pre-merger identification plays in post-merger integration. The current research explores a case study where enhancing pre-merger identification resulted in positive post-merger identification and intergroup relations; progressing knowledge in the field by analysing the contextual factors that facilitate this outcome.Design/methodology/approach– The research follows a case study design applying integration method for the study of changes over time. Two sets of in-depth semi-structured interviews underwent content analysis to derive thematic findings. Case detail was also provided to frame the results.Findings– Findings of the research showed that the integration strategy used to facilitate pre-merger ingroup identification reduced the perceived status differences between groups, moderately improved ingroup relations, and significantly improved intergroup relations.Practical implications– For strategic planners involved in managing change during a merger, the findings provide an alternative integration strategy to be used within a joint-brand structure. The research also provides several analysis points that managers can use to design appropriate integration strategies.Originality/value– The findings are important for the application of SIT to mergers and acquisitions, which commonly view pre-merger identification as a barrier to integration. The current study outlines the contextual factors which strengthen the relationship between pre-merger identity and post-merger identification.