The Urge to Merge: A Multiple‐Case Study

Abstract

AbstractThe authors undertook a comparative study of three recent mergers of nonprofit organizations in a Midwestern urban center, within the context of political‐economy theory. The research explored the impact of the same environmental factor, managed care, on the initial decisions by organizational leaders and the effects of these early decisions on subsequent actions taken to implement the merger. The study tested the authors' model of the motivations for merging, which proposes that the relationship between the decision‐making style of the leadership and the internal and external resources of the prospective partners determines whether the merger is driven primarily by mission, practicality, stability, or fear. Although the findings provide initial support for the hypotheses derived from the model, a demonstration of the differences in the approach to the merger by each organization indicated that other factors emerged as important driving forces during the various phases of the process.