Table of contents(9 chapters)
Acquisition integration is important to realize synergies and to achieve acquisition success. However, there is a lack of clarity on pertinent integration approaches suggesting that integration is more complex and dynamic than traditionally assumed. In this chapter, we shed light on ambiguous cause effect relationships by investigating the effect of integration related decisions on intermediate goals. Additionally, we argue that entrepreneurial integration skills, or proactivity under ambiguity, are needed to keep pace with the dynamism inherent in acquisition integration. Based on primary data on 116 acquisitions, we find that entrepreneurial integration skills can display both advantages and disadvantages. While it helps to realize expected and serendipitous synergies, it can also trigger employee uncertainty due to decreased transparency. In supplementary analysis, we show measures to outperform with various integration approaches. Implications for management research and practice are identified.
Researchers have shown increased interest in open innovation – that is, the inflow and outflow of ideas, or the collaborative efforts of innovating – while previous research on acquisitions of innovative firms has foremost focused on the inflow only. Open innovation, however, introduces several new challenges related to acquisitions of such firms, not the least related to intellectual property rights and innovative skills that may be distributed among several parties. This paper explores what issues the literature on open innovation and acquisitions deals with related to acquisitions in open innovation environments.
A systematic literature review is conducted to achieve the purpose of the paper. Two main questions are addressed. First, how can acquisitions be understood in relation to open innovation? Second, what does the open innovation literature say on matters of distributed innovations in relation to acquisitions?
The paper concludes that there is a quite limited amount of research concerning itself with open innovation and acquisitions combined. Furthermore, acquisitions are for the most part seen as a means to reach innovation in transaction-based transfers between parties.
With acquisitions of innovative firms, in general, being seen as an important means to reach new ideas, while open innovation is on the rise, the juxtaposing of these phenomena would be of high practical and theoretical relevance to study further.
This research fills a gap in the literature regarding managerial retention and performance in the context of cross-border acquisitions (CBA). Blending institutional with resource-based theories, this study posits that retaining acquired managers becomes more important in unfamiliar environments where the institutional infrastructure is underdeveloped. Our results support the theory. Contrary to expectations and prior research, however, the results also call into question the long-held belief that managerial retention is generally beneficial to post-acquisition performance. The findings and implications are discussed regarding managerial turnover, CBA, and the institutional environment.
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. This chapter examines the structure, patterns and investment focus of telecommunication, IT, consumer electronics and media & entertainment firms’ CVC investments by conducting a data-mining project based on the Thomson Reuters Private Equity database. The data-mining project 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. Therefore, following chapter is one of the first CVC studies to describe and compare CVC investments of the last CVC wave across industry sectors.
As the developing nations grow and experience rapid institutional transformation, research has begun to investigate the roles of culture, cognition and institutional context on entrepreneurship and innovation. This chapter 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 authors theorize that (1) individual actors and the level of institutional development jointly comprise the entrepreneur’s logic orientation; (2) the level of perceived ambiguity mediates the strategy adopted by high-tech entrepreneurs; (3) the entrepreneur’s logic orientation can be regarded as a continual spectrum from effectuation to causation. Finally, the logic orientation concept is applied to the context of cross-border mergers and acquisitions (M&A) from a process perspective and the implications and fit of logic orientation with the stages of cross-border M&A are discussed.
The primary purpose of this chapter is to offer 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 trigger M&A value destruction. The approach takes the form of a literature overview and conceptual development. As a step toward developing a more elaborate understanding of a customer-centered perspective, this conceptual study identifies five key factors that may lead to value leakage/destruction for acquirers’ of knowledge-intensive firms. Specifically, it identifies 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 as integration rationales and/or actions which pose a challenge to acquired firm customers. In addition, the chapter offers a theoretical framework that serves as an analytical tool, and can thus be used as a foundation for future empirical work on analyzing acquirers’ destruction of value in knowledge-intensive acquisitions through the neglect of acquired firm’s customers. This study does not claim to have provided exhaustive list of all factors regarding acquirer’s integration rationales and/or actions that influence acquired firm customers. Nonetheless, for researchers seeking to build a more comprehensive framework relating to the impact of acquirer’s integration rationales and/or actions on acquired firm’s customers, this framework may serve as a solid foundation for achieving that goal. For practitioners, this study points to the importance of knowledge held by acquired firm customers and the need to maintain such customer relationships in order to avert acquirer’s post-M&A value destruction. In addition, acquirers may also recognize that post-M&A integration changes required following M&A should not be restricted to only the firm’s internal activities and resource deployment but should extend to how the firm interacts or relates with other external value creation actors. This chapter contributes by highlighting and stimulating a discussion on the important role of acquired firm customers in acquisitions of knowledge-intensive firms in informing our understanding of the sources of M&A value leakage/destruction.
- Publication date
- Book series
- Technology, Innovation, Entrepreneurship and Competitive Strategy
- Series copyright holder
- Emerald Publishing Limited
- Book series ISSN