Barriers and Enablers to Organizational Integration in Cross-border Mergers & Acquisitions

University essay from Lunds universitet/Företagsekonomiska institutionen

Abstract: One way to achieve economies of scale and scope, and other potential advantages of firm size, is through mergers and acquisitions (M&As). Being spectacular business events, and very frequent in the eco-system of firms, it has attracted much interest from both researchers and practitioners. However, empirical reviews do not support the popularity of M&A. It seems that the potential synergies are difficult to realize. A key process and major challenge for success, especially for cross-border M&As, is organizational integration. In this work, we have studied organizational integration in cross-border M&As primarily through a qualitative re-investigation of three case studies with the intent to understand what barriers and enablers could explain different outcomes. Through the use of an established coding scheme for variables related to synergy realization, and a database containing a number of coded case studies, we have also been able to make quantitative comparisons, which contributed to our analysis. The outcome is a proposal on how an existing model of synergy realization can be refined for cross-border M&As. It includes the addition of state involvement, legal obstacles, national culture, integration management and union power as factors influencing organizational integration.

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