Socio-Cultural Integration in Mergers and Acquisitions : Values and Emotions in the Nordic Approach

'I am happy and proud to see Nordic scholars playing a central role in advancing state-of-the-art knowledge in this important area of management and organization research. A must-read for all interested in Nordic mergers and acquisitions.' Eero Vaara, Professor, Aalto University, Finland Taking a fresh and much-needed perspective on the management of international acquisitions, this book focuses on socio-cultural integration, and in particular the importance of emotions and values. The authors build on the human-centric and typically Nordic approach to mergers and acquisitions by presenting rich empirical cases of cross-border acquisitions conducted by leading Nordic multinationals. This book goes beyond merely stating that successful human integration leads to sociocultural convergence and presents how this can actually be accomplished. The authors offer theoretical approaches and practical solutions which have the potential of improving employee motivation and well-being, and in doing so, ultimately enhancing the chances of successful acquisition outcomes. Providing concrete examples of successful practices for managing socio-cultural integration and facilitating employee commitment, this book will appeal to both scholarly and practitioner audiences. Johanna Raitis is a Postdoctoral Researcher at the University of Turku, Finland. Riikka Harikkala-Laihinen is a doctoral candidate in the School of Economics at the University of Turku, Finland. Mélanie E. Hassett is a lecturer in International Business in the Management School of Sheffield University, UK. Niina Nummela is Professor in International Business in the School of Economics at the University of Turku, Finland Foreword: Making Mergers and Acquisitions Work—The Socio-cultural Perspective 5 The Role of Emotions in Mergers and Acquisitions 6 The Role of Values in Mergers and Acquisitions 7 Future Challenges 7 Preface 11 Acknowledgements 13 Contents 14 Notes on Contributors 18 List of Figures 21 List of Tables 22 Chapter 1: A New Research Agenda for Managing Socio-Cultural Integration 23 Setting the Scene 24 Defining Socio-Cultural Integration 25 Emotions2 in M&As 27 Managing Post-M&A Socio-Cultural Integration Through Shared Values and Identity: Why Does Socio-cultural Integration Matter? 28 What is This Book About? The Nordic Approach to Socio-Cultural Integration Following M&As 30 References 33 Chapter 2: The Triggers and Types of Emotions Emerging in M&As 39 Understanding Emotions in Theory 39 Emotion in the Psychology Literature 39 Cognitive Appraisal Theory 40 Emotion as a Dynamic Process 41 Valence and Arousal 42 Categorising Emotions 43 Group Emotions 43 Emotions in Organisations 47 Understanding Emotions in Practice 48 The Case Company 48 Positive Emotions 49 Happiness 50 Relief 50 Pride 51 Negative Emotions 51 Anxiety 52 Anger 52 Sadness and Jealousy 53 Mixed Emotions 54 Linking the Emotions to Triggers 54 Dynamic Emotions at the Case Company 59 Group Emotions at the Case Company 60 Conclusion 62 References 64 Chapter 3: Relational Identity Construction in the Merger of Equals 67 Background 67 Literature Review 69 Identity Work 69 Identity Regulation 70 Relational Approach to Identity Construction 71 Joint Identity Construction at the Case Company 72 Identity Regulation: The Managerial Framework and Guidance 72 Labelling the Values 72 Planning the Workshops and Training the Facilitators 73 Identity Work at the Workshops: The Interpretative and Mental Activities 74 Outcome: Employees’ Perceptions of the Values and the Value Workshops 76 Continued Identity Construction: Enforcing the Values Through Everyday Interaction 77 Conclusion 79 Managerial Summary 81 Checklist for Managers 82 References 82 Chapter 4: Leading M&As in a Middle Managerial Role: A Balancing Act 86 Introduction 87 Middle Managerial Agency in Times of Strategic Change 89 Middle Manager’s Change Agent Roles in M&As 91 Implementing Change 91 Introducing the Acquiring Culture 92 Convincing the Locals of the New Era 92 Managing the Inter-Firm Interface 93 Transferring Knowledge 94 Involving the Acquiring Firm 94 Middle Managers Experiencing M&As 95 An Experience at High Pace 96 An Experience in a New Organisation and Environment 97 An Experience Pervaded with Emotional Ambiguity 98 An Experience at the Interface of Two Cultures 99 An Experience that Jeopardises Their Upward Connections 100 The Mindset of Middle Managers Amidst Change 101 Domain Expertise 101 A Cooperative Mindset 101 Assertive Tolerance 103 Mutuality 103 Cultural and Linguistic Intelligence 104 Emotional Intelligence 105 An Inner Sense of Resilience 106 Contextual Intelligence 107 Conclusion 108 Contribution of the Chapter 108 Implications to Middle Managers’ Leadership Development 108 Managerial Implications 109 References 110 Chapter 5: A Long-Term Perspective on Integration: The Case of a Serial Acquirer and Fundamental Human Values 116 Background 116 Literature Review 117 Fairness as a Basis of Unity in an MNC 117 The Different Types of Fairness in Organisations 119 The Emerging Theme: Fairness Perceptions Across Cultures 121 Fairness in the Context of M&As 122 Research Setting 123 Perceptions of Fairness in an MNC Context 124 Doing the Right Thing: The Legality Rule and Ethicality 124 The Quest for Equality: Treating Everyone the Same 127 The Social Construction of Fairness: Expansion of Control and Voice 129 Conclusions 131 Managerial Summary 132 References 133 Chapter 6: Conclusions: How to Achieve Socio-Cultural Integration 139 References 143 Index 145 'I am happy and proud to see Nordic scholars playing a central role in advancing state-of-the-art knowledge in this important area of management and organization research. A must-read for all interested in Nordic mergers and acquisitions.' Eero Vaara, Professor, Aalto University, Finland Taking a fresh and much-needed perspective on the management of international acquisitions, this book focuses on socio-cultural integration, and in particular the importance of emotions and values. The authors build on the human-centric and typically Nordic approach to mergers and acquisitions by presenting rich empirical cases of cross-border acquisitions conducted by leading Nordic multinationals. This book goes beyond merely stating that successful human integration leads to sociocultural convergence and presents how this can actually be accomplished. The authors offer theoretical approaches and practical solutions which have the potential of improving employee motivation and well-being, and in doing so, ultimately enhancing the chances of successful acquisition outcomes. Providing concrete examples of successful practices for managing socio-cultural integration and facilitating employee commitment, this book will appeal to both scholarly and practitioner audiences. Johanna Raitis is a Postdoctoral Researcher at the University of Turku, Finland. Riikka Harikkala-Laihinen is a doctoral candidate in the School of Economics at the University of Turku, Finland. Mélanie E. Hassett is a lecturer in International Business in the Management School of Sheffield University, UK. Niina Nummela is Professor in International Business in the School of Economics at the University of Turku, Finland Front Matter ....Pages i-xxv A New Research Agenda for Managing Socio-Cultural Integration (Mélanie E. Hassett, Niina Nummela)....Pages 1-16 The Triggers and Types of Emotions Emerging in M&As (Riikka Harikkala-Laihinen)....Pages 17-44 Relational Identity Construction in the Merger of Equals (Johanna Raitis, Riikka Harikkala-Laihinen)....Pages 45-63 Leading M&As in a Middle Managerial Role: A Balancing Act (Satu Teerikangas, Gustavo Birollo)....Pages 65-94 A Long-Term Perspective on Integration: The Case of a Serial Acquirer and Fundamental Human Values (Johanna Raitis)....Pages 95-117 Conclusions: How to Achieve Socio-Cultural Integration (Mélanie E. Hassett, Niina Nummela)....Pages 119-124 Back Matter ....Pages 125-127