Managing Emotions in Organizations

Abstract

It is something of a mystery as to why and how some international acquisitions succeed, and others fail to achieve their expected performance. Negative emotions in the workforce are suspected of playing an important role, but whether these are consequences or causes of underperformance remains obscure. This in depth case study research by Dr. Riikka Harikkala-Laihinen gives us some pointers that, for many of us, will chime with our experience. International acquisitions typically cut across cultural boundaries, but it is not these boundaries themselves that are the problem. It is the way that we, and management respond to them, to anticipate concerns. This is important because, it puts the ball back firmly in the court of management, and gives agency to the firm's leadership. Dr. Harikkala-Laihinen's analysis suggests that the key is positivity. This is not merely spin. Conviction by leaders, and action through, for example, training to engender inclusivity and positive emotional attitudes allays the natural fears of staff that eat away at their ability to work together across cultures and perform at their best. This individual and team level underperformance adds up to, not surprisingly, underperformance at the acquisition level. But, positivity, it is suggested, can turn outcomes around. This research is important both for the academic subject field of International Business, as it gets to the heart of questions that remain with us today, and are still unresolved. It is important for international management practice, precisely because it suggests something can be done, and that where there is a will, there is always a way. That, quite simply, is the power of positivity.

The role of emotions during mergers and acquisitions: A review of the past and a glimpse into the future

“…Negative emotions are particularly present among target firm managers. When an M&A is hostile or unequal (e.g., significant differences in the firms’ sizes), they experience fear, stress, anxiety and uncertainty due to emotional registration of control loss, (identity) threat and a sense of illegitimacy (Appelbaum et al., 2000; Harikkala‐Laihinen, 2020; Teerikangas, 2012).…”

“…Their firms combine to establish a new entity. Making sense of such events determines discrete moods and emotions, leading to positive attitudes and effects, such as increased motivation in making employees work towards change (Harikkala‐Laihinen, 2020). Alternatively, negative effects can arise due to the fear of being unable to perform under new work arrangements, resulting in resistance (Kavanagh & Ashkanashy, 2006).…”

“…Effective dialogue and coaching can facilitate complex relationships regarding communication, uncertainty, perceived socio‐cultural differences and outcomes. Positive emotions are fostered by epistemic, social and compassionate information processing, overcoming (cultural) conflict (Harikkala‐Laihinen, 2020; Zhang et al., 2015). We summarize our findings on this phase's four streams of research in Table 3.…”

Emotional dynamics during post-acquisition integration

“…Negative emotions are particularly present among target firm managers. When an M&A is hostile or unequal (e.g., significant differences in the firms' sizes), they experience fear, stress, anxiety, and uncertainty due to emotional registration of control loss, (identity) threat, and a sense of illegitimacy Harikkala-Laihinen, 2020;Teerikangas, 2012).…”

“…Their firms combine to establish a new entity. Making sense of such events determines discrete moods and emotions, leading to positive attitudes and effects, such as increased motivation in making employees work toward change (Harikkala-Laihinen et al, 2020). Alternatively, negative effects can arise due to the fear of being unable to perform under new work arrangements, resulting in resistance (Kavanagh and Ashkanashy, 2006).…”