M&As and Their Impact on the Organization

Abstract

This paper deals with the M&A process. Since it is a broad area we have decided to concentrate on the organizational change that occurs in an M&A, the integration phase, and what this means to people in the organization. To understand the underlying reasons behind the M&A and their impact on the process, we have also discussed the motives. The theory we have used is based upon M&A research as well as on organizational change theory. The reason why we decided to take this approach in our paper is that this is something that has not been extensively discussed in previous literature and research on M&As. The empirical part of our study is conducted on three companies, which are all in different industries, of different sizes, and with different situations for the M&A. Our first firm was a medical engineering firm based in Gothenburg. They represent a medium sized firm, and they bought a competitor in the US. Then we used a small firm based in Gothenburg that produces masts for yachts. We have looked at their acquisition of a competitor in the UK. The third firm that we have used is a large Swedish pharmaceutical company that has merged with a UK-based pharmaceutical company, however, for our research we have concentrated on the R&D function. Material has been gathered from these companies through interviews, which we have later analyzed with the help from the theories. We conclude in the end of the paper that it is difficult to make a general model on how to carry out and to succeed with an M&A, but there are some areas that need special attention during the integration process to make it as smooth as possible. Here, we have detected some specific areas. The first deals with the handling of the change process, which occurs in an M&A. This is a difficult process to master since we have understood that people tend to resent change. Therefore, it is important to have a strategy with a clear goal for the integration and the change process. A second concern is that the firms to be acquired or merged, should be complementary in products, and in the organizational culture, so that management is somewhat similar. This seems to make the integration proceed with fewer problems. Our final reflection on the topic is that a general model for success of an M&A is not possible to make. The plan for the integration and change process has to be drawn from the specific situation that the two firms are facing.