Towards unlocking the full potential of acquisitions

The role of organizational restructuring

H.G. Barkema, M.P.G. Schijven

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Building on behavioral theory, we study when and how firms unlock synergy from acquisitions over extended periods of time. We argue that initial integration is inevitably suboptimal and that, as a result, acquisitive growth decreases an acquirer's performance, eventually forcing it to engage in organizational restructuring to more fully unlock the synergistic potential. Hence, we conceptualize organizational restructuring as a second stage in the integration process. Moreover, we theorize about how acquisition-restructuring cycles evolve as firms gain acquisition and restructuring experience. We tested our theory using panel data on firms undertaking almost 1,600 acquisitions over four decades.
Original languageEnglish
Pages (from-to)696-722
JournalAcademy of Management Journal
Volume51
Issue number4
Publication statusPublished - 2008

Fingerprint

Organizational restructuring
Integration process
Behavioral theory
Synergy
Panel data

Cite this

@article{fb14187b3262419097101281f4f72413,
title = "Towards unlocking the full potential of acquisitions: The role of organizational restructuring",
abstract = "Building on behavioral theory, we study when and how firms unlock synergy from acquisitions over extended periods of time. We argue that initial integration is inevitably suboptimal and that, as a result, acquisitive growth decreases an acquirer's performance, eventually forcing it to engage in organizational restructuring to more fully unlock the synergistic potential. Hence, we conceptualize organizational restructuring as a second stage in the integration process. Moreover, we theorize about how acquisition-restructuring cycles evolve as firms gain acquisition and restructuring experience. We tested our theory using panel data on firms undertaking almost 1,600 acquisitions over four decades.",
author = "H.G. Barkema and M.P.G. Schijven",
year = "2008",
language = "English",
volume = "51",
pages = "696--722",
journal = "Academy of Management Journal",
issn = "0001-4273",
publisher = "Academy of Management",
number = "4",

}

Towards unlocking the full potential of acquisitions : The role of organizational restructuring. / Barkema, H.G.; Schijven, M.P.G.

In: Academy of Management Journal, Vol. 51, No. 4, 2008, p. 696-722.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - Towards unlocking the full potential of acquisitions

T2 - The role of organizational restructuring

AU - Barkema, H.G.

AU - Schijven, M.P.G.

PY - 2008

Y1 - 2008

N2 - Building on behavioral theory, we study when and how firms unlock synergy from acquisitions over extended periods of time. We argue that initial integration is inevitably suboptimal and that, as a result, acquisitive growth decreases an acquirer's performance, eventually forcing it to engage in organizational restructuring to more fully unlock the synergistic potential. Hence, we conceptualize organizational restructuring as a second stage in the integration process. Moreover, we theorize about how acquisition-restructuring cycles evolve as firms gain acquisition and restructuring experience. We tested our theory using panel data on firms undertaking almost 1,600 acquisitions over four decades.

AB - Building on behavioral theory, we study when and how firms unlock synergy from acquisitions over extended periods of time. We argue that initial integration is inevitably suboptimal and that, as a result, acquisitive growth decreases an acquirer's performance, eventually forcing it to engage in organizational restructuring to more fully unlock the synergistic potential. Hence, we conceptualize organizational restructuring as a second stage in the integration process. Moreover, we theorize about how acquisition-restructuring cycles evolve as firms gain acquisition and restructuring experience. We tested our theory using panel data on firms undertaking almost 1,600 acquisitions over four decades.

M3 - Article

VL - 51

SP - 696

EP - 722

JO - Academy of Management Journal

JF - Academy of Management Journal

SN - 0001-4273

IS - 4

ER -