The Urge to Merge Organisational Change and the Merger and Acquisition Process in Europe

The Urge to Merge Organisational Change and the Merger and Acquisition Process in Europe 32 Management Research News Volume 14 Number 10 1991 Industrial Relations Following Organisational Developments the employment relationship, the role of trade unions, and The Urge to Merge: Organisational ideological and normative regulation. Finally, there is em­ Change and the Merger and ployment levels and uses of different categories of labour. Acquisition Process in Europe These areas of organisational change are analysed Paul Thompson and Terry Wallis, Lancashire Polytechnic from a number of angles. We evaluate whether the and Jorg Flecker, Institute for Advanced Studies, Vienna changes are a result of organic development of the ac­ quired company or strategic initiatives taken by the new Most contemporary business developments can, if you owners and managements. Though there are significant try hard, be linked to 1992 and the single market. With exceptions, the main message is one of continuity. Where takeovers you don't even have to try. The official Cecchi- there has been significant trend we try and relate it to the ni Report makes clear that mergers and acquisitions to type and character of the acquisition, as well as the ten­ eliminate smaller and supposedly less efficient units will sion between contrasting cultures. be the driving force of intensified competition and restruc­ turing to exploit economies of scale. But we do not argue that the situations can be ex­ plained in inter or intra firm terms. It is important to assess The merger and acquisition process is under-re­ the extent to which initiatives to re-organise work and em­ searched from an organisational perspective. The domi­ ployment are conditioned by international trends in mar­ nant literatures are legal, economic and accounting, and kets, technologies and human resource strategies. are concerned with motives for mergers and the sub­ sequent test for post-acquisition synergy. Only in the US Finally we give full recognition to the national and in­ is their any substantial number of organisational studies, stitutional context. Austria and the UK provide very differ­ and these are overwhelmingly concerned with a fairly nar­ ent legal, political and cultural environments. Despite the row range of behavioural issues. general swing across Europe towards neo-Iiberal regimes epitomised by the Thatcher years, Austria remains high­ This paper seeks to extend those debates by focus­ ly corporatist and structures such as the works council ing on organisational issues of control, work organisation system inevitably shape the nature and consequence of and employment relationships in primarily post-acquisi­ the takeover process. These contrasts are fully brought tion contexts. It is based on collaborative research over out to complete an analysis or organisational change that the past 18 months between the Centre for Research on combines international, national and company level fac­ Employment and Work at Lancashire Polytechnic, and tors. the Institute for Advanced Studies in Vienna. The UK research consists of eleven case studies of companies taken over between 1987-9 in the Manches­ ter area, supplemented by three more in-depth analysis of firms around Preston. The Austrian research project also investigated a sample of eleven firms in four manu­ facturing sectors, with emphasis on the outcome of take­ overs by foreign-owned enterprises. Both studies rely primarily on semi-structured interviews with senior man­ agement and were possible trade union representatives. The companies in the two countries are not strictly comparable by sector or size. But collaboration was undertaken in order to provide for comparability of ques­ tions and issues. We are therefore able to provide a com­ mon focus on the main processes of organisational change that develop as a consequence of the takeover. Analysis is undertaken in a number of areas. First that of work organisation, with a focus on flexibility, team and cell-working, and employee involvement. Industrial rela­ tions is the second dimension, with emphasis on shifts in http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Management Research News Emerald Publishing

The Urge to Merge Organisational Change and the Merger and Acquisition Process in Europe

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0140-9174
DOI
10.1108/eb028184
Publisher site
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Abstract

32 Management Research News Volume 14 Number 10 1991 Industrial Relations Following Organisational Developments the employment relationship, the role of trade unions, and The Urge to Merge: Organisational ideological and normative regulation. Finally, there is em­ Change and the Merger and ployment levels and uses of different categories of labour. Acquisition Process in Europe These areas of organisational change are analysed Paul Thompson and Terry Wallis, Lancashire Polytechnic from a number of angles. We evaluate whether the and Jorg Flecker, Institute for Advanced Studies, Vienna changes are a result of organic development of the ac­ quired company or strategic initiatives taken by the new Most contemporary business developments can, if you owners and managements. Though there are significant try hard, be linked to 1992 and the single market. With exceptions, the main message is one of continuity. Where takeovers you don't even have to try. The official Cecchi- there has been significant trend we try and relate it to the ni Report makes clear that mergers and acquisitions to type and character of the acquisition, as well as the ten­ eliminate smaller and supposedly less efficient units will sion between contrasting cultures. be the driving force of intensified competition and restruc­ turing to exploit economies of scale. But we do not argue that the situations can be ex­ plained in inter or intra firm terms. It is important to assess The merger and acquisition process is under-re­ the extent to which initiatives to re-organise work and em­ searched from an organisational perspective. The domi­ ployment are conditioned by international trends in mar­ nant literatures are legal, economic and accounting, and kets, technologies and human resource strategies. are concerned with motives for mergers and the sub­ sequent test for post-acquisition synergy. Only in the US Finally we give full recognition to the national and in­ is their any substantial number of organisational studies, stitutional context. Austria and the UK provide very differ­ and these are overwhelmingly concerned with a fairly nar­ ent legal, political and cultural environments. Despite the row range of behavioural issues. general swing across Europe towards neo-Iiberal regimes epitomised by the Thatcher years, Austria remains high­ This paper seeks to extend those debates by focus­ ly corporatist and structures such as the works council ing on organisational issues of control, work organisation system inevitably shape the nature and consequence of and employment relationships in primarily post-acquisi­ the takeover process. These contrasts are fully brought tion contexts. It is based on collaborative research over out to complete an analysis or organisational change that the past 18 months between the Centre for Research on combines international, national and company level fac­ Employment and Work at Lancashire Polytechnic, and tors. the Institute for Advanced Studies in Vienna. The UK research consists of eleven case studies of companies taken over between 1987-9 in the Manches­ ter area, supplemented by three more in-depth analysis of firms around Preston. The Austrian research project also investigated a sample of eleven firms in four manu­ facturing sectors, with emphasis on the outcome of take­ overs by foreign-owned enterprises. Both studies rely primarily on semi-structured interviews with senior man­ agement and were possible trade union representatives. The companies in the two countries are not strictly comparable by sector or size. But collaboration was undertaken in order to provide for comparability of ques­ tions and issues. We are therefore able to provide a com­ mon focus on the main processes of organisational change that develop as a consequence of the takeover. Analysis is undertaken in a number of areas. First that of work organisation, with a focus on flexibility, team and cell-working, and employee involvement. Industrial rela­ tions is the second dimension, with emphasis on shifts in

Journal

Management Research NewsEmerald Publishing

Published: Oct 1, 1991

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