Gaining Legitimacy by Telling Stories : The Power of Narratives in Legitimizing Mergers and Acquisitions

Narrative theory is used to explain the role of narratives in legitimizing organizational change. Specifically, the influence of organizational narratives – narratives communicated from an organization’s management to its employees – on the legitimacy employees grant to merger and acquisition (M&A) activity is explored. It is argued that as the narrativity of organizational communication increases, the cognitive legitimacy of M&A activity will increase. Further, a potential moderator of this relationship is identified: employees’ perceived uncertainty about the merger. It is argued that greater employee uncertainty about the future is associated with a greater influence of organizational narratives on the cognitive legitimacy of M&A activity