The intergroup sensitivity effect in mergers and acquisitions: Testing the role of merger motives

Shuang Liang,Anna Lupina‐Wegener,Johannes Ullrich,Rolf Van Dick

doi:10.1111/jasp.12785

Shuang Liang, Anna Lupina‐Wegener + Show 2 more

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https://doi.org/10.1111/jasp.12785

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Abstract

AbstractResearch has shown that people are more defensive to criticism when it stems from an outgroup member, compared to an ingroup member (the intergroup sensitivity effect: ISE). We conducted two online vignette experiments to examine the ISE in the context of an organizational merger and the role of merger motives for the ISE. We predicted that the ISE would also emerge in mergers and acquisitions (M&As), but people would respond less negatively to criticism from the outgroup when the motive for the merger is described as achieving synergies rather than growth. In Experiment 1 (N = 452), which did not mention any motives behind the acquisition, a significant ISE emerged. Experiment 2 (N = 587) again showed an ISE regardless of the merger motive. In both experiments, the ISE was mediated by perceptions of the outgroup criticism as less legitimate and constructive. Overall, this research points to the intergroup sensitivity effect as a relevant phenomenon during post‐merger integration.

Highlights

Receiving criticism of the group can be difficult for group members
Research has shown that people are more defensive to criticism when it stems from an outgroup member, compared to an ingroup member
We predicted that the intergroup sensitivity effect (ISE) would emerge in mergers and acquisitions (M&As), but people would respond less negatively to criticism from the outgroup when the motive for the merger is described as achieving synergies rather than growth

Summary

Introduction

Receiving criticism of the group can be difficult for group members. Legitimate or constructive criticism is vital for group decision making and the group's success (Sommer & Kulkarni, 2012). Legitimate criticism can help to point out blind spots of group issues and push group members to reconsider their decisions and adjust their behaviors (Nemeth & Owens, 1996). Ingroup criticism was evaluated as more constructive than outgroup criticism. If it is not handled well, intergroup criticism might trigger a variety of negative outcomes. Subsequent research showed that criticism from the outgroup leads to counterarguing at the expense of group productivity (Thürmer et al, 2019)

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