Why Companies Do Not Pursue Attractive Mergers and Acquisitions
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Why Companies Do Not Pursue Attractive Mergers and Acquisitions ...

Chapter 1:  Introduction
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  • This school includes, among its major assumptions, that good or appropriate processes can be distinguished from bad or inappropriate ones. Bad or inappropriate ones may result in poor outcomes. Poor outcomes can be avoided and, as a result, acquisition performance can be improved. Performance may, for example, be improved by selecting, in a nonpolitical consultative process, an approach to integration that optimises trade-offs between the desire for control and autonomy of the two parties in light of the requirements of the acquirer to derive the synergies that justified the acquisition (Haspeslagh & Jemison, 1991).

    • A number of other process-related prescriptions are advanced in the normative literature or implied in the empirical literature that do not neatly fit the paradigms as they are described previously. They include suggestions about such factors as the nature and number of employees who should participate in the acquisition decision-making process, and whether or not to use which type of external advisers (Angwin, 2001). There is also a growing body of literature that uses organisational learning theory to explain and predict various aspects of acquisition behaviour (Bjorkman, Tienari, & Vaara, 2003; Hayward, 1999; Lindvall, 1991; Vermeulen & Barkema, 2001; Very & Schweiger, 2001). And various means of achieving harmonious integration have been identified so that the benefits of mergers and acquisitions are achieved (Larsson & Lubatkin, 2001).

    1.2.3.3. Recognising the Limitations of the Traditional View of Performance Improvement

    A multiplicity of diverse disciplines and streams contribute to predicting acquisition performance and understanding how it might be improved. For example, by formulating better and more explicit rationales for making acquisitions, by incorporating measures of the potential for asset, skill, and capability transfer into definitions of strategic fit (and the criteria that constitute it) (Haspeslagh & Jemison, 1991), and by analysing both strategic fit and organisational fit, poor choices can be minimised.