The Impact of Leadership and Change Management Strategy on Organizational Culture and Individual Acceptance of Change during a Merger

Abstract

This article reports a longitudinal study that examined mergers between three large multi-site public-sector organizations. Both qualitative and quantitative methods of analysis are used to examine the effect of leadership and change management strategies on acceptance of cultural change by individuals. Findings indicate that in many cases the change that occurs as a result of a merger is imposed on the leaders themselves, and it is often the pace of change that inhibits the successful re-engineering of the culture. In this respect, the success or otherwise of any merger hinges on individual perceptions about the manner in which the process is handled and the direction in which the culture is moved. Communication and a transparent change process are important, as this will often determine not only how a leader will be regarded, but who will be regarded as a leader. Leaders need to be competent and trained in the process of transforming organizations to ensure that individuals within the organization accept the changes prompted by a merger.

The impact of leadership on organizational ambidexterity and employee psychological safety in the global acquisitions of emerging market multinationals

“…The role played by leadership is undeniably quite pertinent to organizational survival and essential to the development of an ambidextrous organization (Jansen, Tempelaar, Van den Bosch & Volberda, 2009;Cao, Simsek & Zhang, 2010;Rosing, Frese & Bausch, 2011;Tushman et al, 2011). Leader role is important for the development of systems, structures and cultures that support the assimilation of knowledge during mergers (Kavanagh & Ashkanasy, 2006), and successful integration following M&As (Vasilaki, 2011). Scholars indicate that contextual factors such as senior team integration helps in balanced resource allocation, forms cross-fertilization and synergies towards ambidextrous activities (e.g., Jansen et al 2008), and the ambidexterity performance link is also suggested to be the outcome of contextual variables and it is positively related to performance (Junni et al, 2013).…”

The effect of leadership style on talent retention during Merger and Acquisition integration: evidence from China

“…Successful post-M&A integration depends on a sound leadership style that enables organizational and cultural adaptation as well as alignment of expectations between the amalgamating entities (Covin, Kolenko, Sightler, and Tudor, 1997;Gomes, Cohen, and Mellahi, 2011;Kavanagh and Ashkanasy, 2006;Nemanich and Vera, 2009;Sitkin and Pablo, 2005a;2005b;Thach and Nyman, 2001;Waldman and Javidan, 2009). …”

Managing Nonprofit Mergers: The Challenges Facing Human Service Organizations

“…While there is often a desire to minimize the transition time, there is also a need for a thorough and deliberative process (Jemison & Sitkin, 1986;Marks & Mirvis, 1998;McCormick, 2001a). Indeed, Kavanagh and Ashkanasy (2006) found higher rates of staff satisfaction with mergers for organizations that used a gradual approach (i.e., negotiations were thorough and conducted with one organization at a time) than with organizations that used a quick, top-down approach. In essence, a balance needs to be found between maintaining momentum and allowing for sufficient time to promote involvement and decision making.…”

“…A positive climate includes the presence of clarity, openness, and support that lead to continued or increased organizational commitment and identity for staff and successful implementation of change. A negative climate involves the absence of honest and direct communication, and can lead to staff members feeling vulnerable and distrustful of the leaders of the change process (Bartels et al, 2006;Kavanagh & Ashkanasy, 2006). The frequent dissemination of candid and accurate information can greatly reduce staff reliance on a rumor mill and distrust of management (Campbell, 2008;McCormick, 2001b;Nguyen & Kleiner, 2003).…”

“…The following key leadership activities need to be defined and understood as part of both understanding the merger process and addressing the human element: 1) becoming knowledgeable about merger processes, 2) supporting staff, and 3) recognizing the leaders' own emotional reactions to change (Kavanagh & Ashkanasy, 2006;Thach & Nyman, 2001). Competent leadership in a merger situation includes the knowledge of what to expect during a restructuring process, the organizational culture issues, the time required for successful change, and the nature of the organizational change processes needed to address staff issues.…”