Richard Schoenberg

The influence of cultural compatibility within cross-border acquisitions: A review

This chapter synthesises theoretical and empirical perspectives on cultural compatibility within cross-border acquisitions, drawing on both the organisational and national culture streams of acquisitions literature. The impact of cultural compatibility on subsequent acquisition performance is seen to revolve around the form of post-acquisition integration and the relative attractiveness of the acquirers culture. For the latter, there is some evidence that attitudes towards participation, formality and risk may have a particular importance, although the relative influence between organisational and national culture remains unclear. Avenues for future research are indicated.

Does e-Business Require Different Leadership Characteristics?: an Empirical Investigation

Universal theories of leadership argue that all effective leaders share an identifiable set of common attributes. This suggests that the characteristics that have defined leadership in traditional bricks and mortar organisations are equally applicable to e-business. In contrast, contingency theories argue that a leader must match their environmental and organisational settings, suggesting that the different situational context of e-business will dictate a distinctive set of leadership characteristics. This paper empirically explores these opposing arguments. Data on the traits, behaviours and skills possessed by leaders of both e-businesses and traditional bricks and mortar companies were collected using a combination of questionnaire surveys and semi-structured interviews. Analysis of the data provides a degree of support for both arguments. The majority of characteristics possessed by leaders of traditional bricks and mortar organisations are found to be equally valued in the digital economy. There are, however, a certain number of characteristics that are emphasised within e-businesses. These include a propensity for risk taking, entrepreneurialism, networking ability, as well as the requisite technical skills.

What determines acquisition activity within an industry

Acquisitions in the UK have shown a steadily rising trend over recent years and one of the noticeable features of the current takeover wave is that it is concentrated in certain industry sectors. This article outlines five factors that may explain this variation in acquisition rates across industry sectors. An empirical investigation based on data from 200 UK industry sectors is then described which reveals that exposure to deregulation is in fact the most important single discriminator between industries with high and low acquisition activity. Industry concentration and industry growth rate are also supported as determinants of the takeover rate within an industry. The results suggest that external changes to industry regulation may act as a greater trigger to industry restructuring than internal industry dynamics, and raise important issues for policy makers given the contradictory findings on the economic benefits of M&A activity.

DIMENSIONS OF MANAGEMENT STYLE COMPATIBILITY AND CROSS-BORDER ACQUISITION OUTCOME

This paper examines how differences in management styles impact the performance of cross-border acquisitions. Two principal findings are reported. First, the study focuses on the individual dimensions of management style and highlights the particular influence that differences in risk orientation exert on acquisition outcome. This result, although unexpected, is argued to be consistent with prior literature that places risk orientation in a central role within organisational behaviour. Second, the relationship between management style compatibility and cross-border acquisition performance is found to be contingent upon the level of organisational interaction imposed by the post-acquisition process. Implications are drawn for both researchers and practitioners.

European cross-border acquisition: How was it for you?

Abstract Cross-border acquisition activity within Europe has increased four fold over the last 5 years yet continues to be a high risk form of corporate expansion, since one in two purchases end in ‘failure’. This article discusses the types of cross-border acquisitions British companies are making, the acquisition processes they are adopting, and the major areas in which unforeseen difficulties are experienced. It is based upon data collected from 70 UK companies, each of which have made a recent acquisition in Continental Europe. The key lesson that emerges for future cross-border acquires is the need for relatively specialized integration skills: typically, post-acquisition difficulties are likely to be compounded by cultural differences and the need to facilitate the transition from family to professional management.

Strategies for business turnaround and recovery: a review and synthesis

Purpose – Against a backdrop of continued weak economic conditions and with many firms experiencing declining financial performance, this paper presents a synthesis of the business turnaround literature. It aims to identify which turnaround and recovery strategies have been effective historically, based on the evidence provided by previous empirical research.Design/methodology/approach – The authors review literature that includes 22 empirical studies, which investigated business turnarounds in previous recessionary environments. This literature was reviewed in its entirety, rather than as individual contributions, to synthesise the lessons available for businesses operating in todays challenging economic environment.Findings – The literature review revealed convergence in the findings of the prior studies. In total, six effective turnaround strategies were consistently identified and four of these relate to the content of the turnaround, namely: cost efficiencies, asset retrenchment, a focus on the firm...

Customer and Competitor Responses to Mergers and Acquisitions: An Empirical Investigation in the Logistics Industry

We present an empirical investigation into how customers and competitors respond to merger and acquisition (M&A) activity, using data obtained from business-to-business customers of logistics industry acquisitions. We draw on the M&A and marketing literatures to develop a set of hypotheses about how customer loyalty may be affected by a suppliers involvement in an acquisition, including the influence of competitors reactions. Our data confirm that customers purchase behaviours can be affected by M&A activity, both positively and negatively, and we find support for a causal chain whereby post-acquisition integration actions cause changes in key customer relationship variables, which in turn drive changes in customer loyalty. Our results also provide empirical evidence of the significant role that competitors responses can play in reducing customer loyalty following an acquisition. We identify a number of factors that appear to influence the magnitude of competitors reactions, namely the scale and scope of the acquisition, the form of post-acquisition integration pursued and the ‘stickiness’ of existing customers. The implications of our findings for future research, as well as for executives engaged in M&A activity, are discussed.

Travel abroad or stay at home?: Investigating the patterns of bank industry M&As in the EU

Purpose – The purpose of this study is to investigate the extent of bank industry consolidation across the European Union, the patterns that have emerged from the mergers and acquisitions (M&As) and the regulatory framework that underpins these processes. It aims to identify the key challenges that have to be addressed if M&As are to expand.Design/methodology/approach – The paper reviews the reasons that have led some financial institutions to merge, both domestically and cross‐border, and the developments that have taken place in the economic, legal and political environment. The paper presents an empirical analysis of bank industry M&As within the EU between 1993‐2004 and identifies possible explanations for the patterns of consolidation.Findings – The analysis provides evidence that M&As predominantly take place at the national level and that two main strategies have emerged, namely the consolidation of commercial banking and the creation of universal banking groups.Research limitations/implications – ...

Value creation in corporate acquisitions: Linking value creation logic, organisational capabilities and implementation processes

We propose a typology of acquisition value creation logics derived from the dynamic capability literature and explore the organisational capabilities and implementation processes required for the effective delivery of three value creation logics: governance-based, cost-based and knowledge-based. We argue that each value creation logic calls for a specific and distinct set of acquirer capabilities and post-acquisition implementation processes. We put forward a contingency approach, where effective corporate acquirers make a conscious choice as to their predominant value creation logic based on a consideration of their organisational capabilities, which, in turn, defines the characteristics of appropriate target companies and the necessary implementation actions required to realise value post-acquisition. We discuss the implications for both acquiring firm executives and future M&A research.