Private equity and human resource management: ‘Barbarians at the gate!’ HR’s wake-up call?

Abstract

A private equity buyout (PEB) constitutes an important organizational event that usually heralds major organizational transformations. As such, the announcement of a possible PEB can be expected to impact the organization and require careful management of the pre-PEB process. This article investigates the role and contribution of human resource management (HRM) during a two-year process of negotiations preceding a PEB. It shows the vulnerability of HR-based change contributions to uncertainty about the future, as uncertainty accentuates the ambiguity inherent in HRM based change. Furthermore, it highlights the importance of the role of top-management and the possibilities for HRM during the period leading up to a PEB.

Rethinking ‘Top‐Down’ and ‘Bottom‐Up’ Roles of Top and Middle Managers in Organizational Change: Implications for Employee Support

“…A fruitful avenue would be to examine and consolidate the micro‐processes through which TMs and MMs can actually make different role configurations work. Indeed, research in this area is gaining significant momentum, albeit in diverse niches, such as quality of change communications (Boselie and Koene, ; Vuori and Huy, ), shared professional identities to stimulate extra‐role behaviours (Heyden et al, 2015a), regulatory foci of middle managers and their search behaviors (Ahmadi et al, 2017), a shared interpretative context to cope with the paradoxical change demands (Knight and Paroutis, ), strategic consensus involving different management levels (Tarakci et al, ), and integrative bargaining between TMs and MMs (Raes et al, ). Our study on TM‐MM role configurations adds an important conceptual frame that allows us to organize, develop, and critically evaluate this nascent literature and question extant assumptions regarding the roles that TMs and MMs play in organizational change.…”

The Impact of Private Equity on Management Practices in European Buy‐outs: Short‐termism, Anglo‐Saxon, or Host Country Effects?

“…During 1999-2007, 21 percent of UK deal value was accounted for by private equity investors of U.S. origin; the corresponding percentage in Continental Europe was 14 percent (CMBOR 2008). Despite portraying U.S. and UK private equity investors as ''barbarians at the gate'' (Boselie and Koene 2010), no research has assessed whether they have a different impact on management practices than non-Anglo-Saxon private equity investors. Thus, we focus on whether management practices change as a result of investment by Anglo-Saxon private equity investors compared to non-Anglo-Saxon counterparts and whether the private equity investor was foreign to the context where it invested.…”

Country of Origin Effects and New Financial Actors: Private Equity Investment and Work and Employment Practices of French Firms

“…It brings to bear new evidence from France, supplementing an emerging body of literature on PE in continental Europe (cf. Bacon et al 2012;Boselie and Koene 2010).…”