Prelims

Mergers and Acquisitions, Entrepreneurship and Innovation

ISBN: 978-1-78635-372-6, eISBN: 978-1-78635-371-9

ISSN: 1479-067X

Publication date: 13 October 2016

Citation

(2016), "Prelims", Weber, Y. and Tarba, S.Y. (Ed.) Mergers and Acquisitions, Entrepreneurship and Innovation (Technology, Innovation, Entrepreneurship and Competitive Strategy, Vol. 15), Emerald Group Publishing Limited, Leeds, pp. i-xii. https://doi.org/10.1108/S1479-067X20160000015010

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Emerald Group Publishing Limited

Copyright © 2016 by Emerald Group Publishing Limited


Half Title Page

MERGERS AND ACQUISITIONS, ENTREPRENEURSHIP AND INNOVATION

Series Page

TECHNOLOGY, INNOVATION, ENTREPRENEURSHIP AND COMPETITIVE STRATEGY

Series Editor: Barak S. Aharonson

Recent Volumes:

Volume 1: Newgames – Strategic Competition in the PC Revolution – Edited by J. Steffens
Volume 2: Entrepreneurship: Perspectives on Theory Building – Edited by I. Bull, H. C. Thomas and G. Willard
Volume 3: Dynamics of Competence-Based Competition – Edited by R. Sanchez, A. Heene and H. Thomas
Volume 4: Corporate Strategy, Public Policy and New Technologies – Edited by X. Dai
Volume 5: Drugs to Market – Edited by W. C. Bogner
Volume 6: The Defense Industry in the Post-Cold War Era – Edited by G. I. Susman and S. O’Keefe
Volume 7: The Strategic Management of High Technology Contracts: The Case of CERN – Edited by M. Nordberg
Volume 8: Creating Value with Entrepreneurial Leadership and Skill-Based Strategies – Edited by W. C. Schulz and C. W. Hofer
Volume 9: Silicon Valley North: A High-Tech Cluster of Innovation and Entrepreneurship – Edited by L. V. Shavinina
Volume 10: Astute Competition: The Economics of Strategic Diversity – Edited by P. Johnson
Volume 11: Constructing Industries and Markets – Edited by J. Porac and M. Ventresca
Volume 12: The Take-off of Israeli High-Tech Entrepreneurship During the 1990s – Edited by A. Fiegenbaum
Volume 13: Understanding the Relationship Between Networks and Technology, Creativity and Innovation – Edited by Barak S. Aharonson, Uriel Stettner, Terry L. Amburgey, Shmuel Ellis and Israel Drori
Volume 14: Exploration and Exploitation in Early Stage Ventures and SMEs Edited by Uriel Stettner, Barak S. Aharonson and Terry L. Amburgey

Title Page

TECHNOLOGY, INNOVATION, ENTREPRENEURSHIP AND COMPETITIVE STRATEGY VOLUME 15

MERGERS AND ACQUISITIONS, ENTREPRENEURSHIP AND INNOVATION

EDITED BY

YAAKOV WEBER

Department of Academic Studies, School of Business Administration, The College of Management, Rishon LeZion, Israel

SHLOMO Y. TARBA

Birmingham Business School, University of Birmingham, Birmingham, UK

United Kingdom – North America – Japan – India – Malaysia – China

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First edition 2016

Copyright © 2016 Emerald Group Publishing Limited

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ISBN: 978-1-78635-372-6

ISSN: 1479-067X (Series)

List of Contributors

Florian Bauer Department of Management and Law, MCI Management Center Innsbruck, Innsbruck, Austria
Sabine Baumann Department of Management, Information, Technology, Jade University, Wilhelmshaven, Germany
William Y. Degbey Turku School of Economics, University of Turku, Turku, Finland
Kátia de Melo Galdino College of Business, Florida State University, Tallahassee, FL, USA
Richard A. Devine College of Business, Florida State University, Tallahassee, FL, USA
Tim C. Hasenpusch Department of Management, Information, Technology, Jade University, Wilhelmshaven, Germany
Andrew Isaak Institute for SME Research and Entrepreneurship, University of Mannheim, Mannheim, Germany
David R. King College of Business, Iowa State University, Ames, IA, USA
Bruce T. Lamont College of Business, Florida State University, Tallahassee, FL, USA
Yipeng Liu Birmingham Business School, University of Birmingham, Birmingham, UK
Christina Öberg School of Business, Örebro University, Örebro, Sweden
Svante Schriber Stockholm Business School, Stockholm University, Stockholm, Sweden
Shlomo Y. Tarba Birmingham Business School, University of Birmingham, Birmingham, UK
Borislav Uzelac Copenhagen Business School, Frederiksberg, Denmark
Yaakov Weber Department of Academic Studies, School of Business Administration, The College of Management, Rishon LeZion, Israel

Introduction

The frequency and scale of the global collaborative partnerships such as mergers and acquisitions (M&A), joint ventures, and strategic alliances have dramatically increased during the past two decades in spite of continuous reports on their high failure rates (Gomes, Weber, Brown, & Tarba, 2011). Unfortunately, studies from different research streams have generally failed to step into each other’s turf, hence missing the opportunities from cross-fertilization (Weber, Tarba, & Reichel, 2009).

Stahl and Voight (2008) point out that most of the existing research on the global M&A has been fragmented across various disciplines, has not been systematic and linked to any comprehensive theory, and rarely have models been proposed that were applicable across different organizations. Furthermore, the degree of organizational change, following the establishing and implementing of the global interorganizational partnerships, may vary substantially across different national and cultural settings.

For instance, the impact of M&A on individuals and groups may differ widely between various human resource management practices (Budhwar, Varma, Katou, & Narayan, 2009; Sarala, Junni, Cooper, & Tarba, 2016; Weber & Tarba, 2010), and be influenced by cultural distance (Reus & Lamont, 2009), strategic agility (Junni, Sarala, Tarba, & Weber, 2015; Weber & Tarba, 2014), knowledge sharing during post-merger integration (Aklamanu, Degbey, & Tarba, 2015), leadership approaches (Nemanich & Keller, 2007; Waldman & Javidan, 2009), self-attribution biases (Billett & Qian, 2008), and talent retention (Zhang et al., 2015).

The goal of this special volume has been to stimulate scholars to explore the multiple theoretical and empirical perspectives and seek cross-fertilization between the various approaches to comprehending innovation management-related topics in the particular context of collaborative partnerships.

The first chapter “Entrepreneurial Integration Skills: Knowing What You Acquire to Integrate It” by Bauer, Shriber, King, and Uzelac highlights the importance of the post-acquisition integration in realizing synergistic benefits and enhancing the overall success of the M&A deal. Yet, it points to the lack of clarity on pertinent integration approaches suggesting that integration is more complex and dynamic than traditionally assumed. Specifically, this chapter sheds light on ambiguous cause–effect relationships by examining the effect of integration-related decisions on intermediate goals, and indicates that entrepreneurial integration skills, or proactivity under ambiguity, are needed to keep pace with the dynamism inherent in acquisition integration.

The next chapter “Acquisitions and Open Innovation – A Literature Review and Extension” by Öberg contends that open innovation poses several new challenges associated with acquisitions of innovative firms, specifically related to intellectual property rights and innovative skills that may be distributed among several parties. This chapter addresses two main issues: first, how can acquisitions be understood in relation to open innovation, and, second, what does the open innovation literature treat the matters of distributed innovations in the particular context of acquisitions. The chapter concludes that acquisitions are for the most part seen as a means to reach innovation in transaction-based transfers between parties.

The chapter “Managerial Retention in Cross-Border Acquisitions: Examining Institutional Influence” by Devine, de Melo Galdino, and Lamont deals with incumbent executives retention and performance in the context of cross-border acquisitions (CBA). Blending institutional with resource-based theories, this chapter shows that retaining managers of the acquired entity becomes more important in unfamiliar environments where the institutional infrastructure is underdeveloped. However, contrary to prior research, the findings also call into question the long-held belief that managerial retention is generally beneficial to post-acquisition performance.

The next chapter “Strategic Media Venturing: Private Equity Investments as a Strategic Tool for Media Firms” is by Hasenpusch and Baumann. It discusses the fast-changing, highly competitive, and technology-driven business environment forces established firms to continually search for new business opportunities and innovative ideas. In reaction, corporations such as Google, Microsoft, Cisco and Bertelsmann have launched new corporate venture capital (CVC) units or have intensified existing CVC activities an external venturing form such as alliances, joint ventures and acquisitions to gain access to new technologies and knowledge. Conducting a data-mining project based on the Thomson Reuters private equity database, the chapter by Hasenpusch and Baumann examines the structure, patterns and investment focus of telecommunication, IT, consumer electronics and media & entertainment firms’ investments done by their new corporate venture capital (CVC) units. The chapter reveals the increasing importance of CVC activities as a strategic development tool to address the requirements of the increasing costs, speed and complexity of a technology-driven industry since the bursting of the internet bubble.

The next chapter “Effectuation Spectra in Chinese High-Tech Entrepreneurship: Domain-Specific Logic Orientations and Cross-Border M&A” by Liu and Isaak aims to advance the entrepreneurial cognition literature by juxtaposing entrepreneurial effectuation, domain-specific expertise and ambiguity. By conducting a qualitative study of Chinese high-tech domestic and returnee entrepreneurs, the authors propose a spectrum between causation and effectuation and argue that the entrepreneur’s perceived level of ambiguity may better explain differing logic orientations among entrepreneurs, contributing to our understanding of entrepreneurial cognition.

The final chapter “Why Good Things May Not Happen in Knowledge-Intensive Acquisitions: The Neglect of Acquired Firm’s Customers” by Degbey offers a conceptual/theoretical understanding of post-M&A integration rationales and/or actions which pose a challenge to acquired firm customers in acquisitions of knowledge-intensive firms, and thus potentially may trigger M&A value destruction. This chapter highlights five key factors that may lead to value leakage/destruction for acquirers’ of knowledge-intensive firms: acquisition motive, specific acquired firm employees other than the engineers and scientists, size of the acquired firm customer base, M&A customer compatibility, and the acquirer’s own customers’ behavior.

We hope that chapters accepted to this volume will further elucidate the existing theory and enhance our understanding of the dynamic nature of collaborative partnerships, as well as contributions exploring the relationships between the innovation management and individual and organizational performance in collaborative partnerships.

Yaakov Weber

Shlomo Y. Tarba

Editors

References

Aklamanu, Degbey, & Tarba (2015) Aklamanu, A. , Degbey, W. Y. , & Tarba, S. Y. (2015). The role of HRM and social capital configuration for knowledge sharing in post-M&A integration: A framework for future empirical investigation. International Journal of Human Resource Management, doi:10.1080/09585192.2015.1075575

Billett & Qian (2008) Billett, M. T. , & Qian, Y. (2008). Are overconfident CEOs born or made? Evidence of self-attribution bias from frequent acquirers. Management Science, 54(6), 10371051.

Budhwar, Varma, Katou, & Narayan (2009) Budhwar, P. S. , Varma, A. , Katou, A. , & Narayan, D. (2009). The role of HR in cross-border mergers and acquisitions: The case of Indian pharmaceutical firms. Multinational Business Review, 17(2), 89110.

Gomes, Weber, Brown, & Tarba (2011) Gomes, E. , Weber, Y. , Brown, C. , & Tarba, S. Y. (2011). Mergers, acquisitions and strategic alliances: Understanding the process. Basingstoke: Palgrave Macmillan.

Junni, Sarala, Tarba, & Weber (2015) Junni, P. , Sarala, R. , Tarba, S. Y. , & Weber, Y. (2015). Strategic agility in acquisitions. British Journal of Management, 26, 596616.

Nemanich & Keller (2007) Nemanich, L. A. , & Keller, R. T. (2007). Transformational leadership in an acquisition. The Leadership Quarterly, 18, 4968.

Reus & Lamont (2009) Reus, T. H. , & Lamont, B. T. (2009). The double-edged sword of cultural distance in international acquisitions. Journal of International Business Studies, 40, 12981316.

Sarala, Cooper, Junni, & Tarba (2014) Sarala, R. M. , Junni, P. , Cooper, C. L. , & Tarba, S. (2016). A socio-cultural perspective on knowledge transfer in mergers and acquisitions. Journal of Management, 42, 12301249.

Stahl & Voight (2008) Stahl, G. K. , & Voight, A. (2008). Do cultural differences matter in mergers and acquisitions? A tentative model for examination. Organization Science, 19(1), 160176.

Waldman & Javidan (2009) Waldman, D. E. , & Javidan, M. (2009). Alternative forms of charismatic leadership in the integration of mergers and acquisitions. The Leadership Quarterly, 20, 130142.

Weber & Tarba (2010) Weber, Y. , & Tarba, S. Y. (2010). Human resource practices and performance of mergers and acquisitions in Israel. Human Resource Management Review, 20, 203211.

Weber & Tarba (2014) Weber, Y. , & Tarba, S. Y. (2014). Strategic agility: A state-of-art. California Management Review, 56(3), 18.

Weber, Tarba, & Reichel (2009) Weber, Y. , Tarba, S. Y. , & Reichel, A. (2009). International mergers and acquisitions performance revisited – The role of cultural distance and post-acquisition integration approach. In C. Cooper & S. Finkelstein (Eds.), Advances in mergers and acquisitions (Vol. 8, pp. 117). Advances in Mergers and Acquisitions. Bingley, UK: Emerald Group Publishing Limited.

Zhang et al. (2015) Zhang, J. , Ahammad, M. F. , Tarba, S. , Cooper, C. L. , Glaister, K. W. , & Wang, J. (2015). The effect of leadership style on talent retention during merger and acquisition integration: Evidence from China. International Journal of Human Resource Management, 26, 10211050.