Merger Repair: A Conceptual Framework for Restoring Employer/Employee Relationships

During mergers and acquisitions a variety of integration management transgressions - both intentional and unintentional - occur. If these are not addressed, there will be a severe and potentially permanent damage to the relationship between the organization and its employees. This area of study has been identified as lacking sufficient examination and is ripe for future work (Haleblian, Devers, McNamara, Carpenter, & Davison, 2009). In this paper, we identify the common sources of these integration transgressions. Drawing on research based in social psychology and merger integration, we develop the construct of merger repair. We also identify several techniques for repairing the damaged relationships. Implications for practitioners and propositions to guide future research are developed. Every corporate acquisition or merger begins with high expectations. Those in favor of the deal - typically, senior management - routinely project synergies to be achieved which will produce levels of performance that have never been achieved. However, this is an often naïve view held by decision makers about a potential deal and the majority of M&A transactions fail to meet those lofty expectations. Moreover, because management is often out of touch with rank-and-file's typically lower expectations pertaining to a pending merger or acquisition, management's confidence about the ease of synergy achievement is frequently unrealistic.