M&A Integration process through the eyes of employees

Abstract

Fast changing operating environment puts pressure on companies to change. If the company is not able to answer to the need of changes, it might be overshadowed by competitors. One-way companies seek strategic growth is by utilizing different corporate restructurings, such as mergers and acquisitions. Integration process that follows mergers and acquisitions is challenging and often causes uncertainties and challenges amongst personnel. Personnel’s needs and emotions should be considered while management also should be able to make tough decisions in fast pace. Therefore, change management’s role is central in integration process and efficient change management contributes to achieve the intended benefits of the corporate restructuring.

The commissioning party of this thesis has recently merged with another company operating in the same field. The integration process was completed during the year 2023. The theoretical framework of this thesis focuses on integration process, personnel’s reactions to change, change management and manager’s role in change. Organizational culture was excluded from this thesis.

The thesis was carried out during 2024 spring as a case study. During past five years, the commissioning party has grown significantly by two different corporate restructurings. The objective of this thesis was to understand how personnel experienced the integration process in the most recent corporate restructuring. This thesis used qualitative method and data was collected by interviews. The interview respondents consisted of members of integration workstreams as well as personnel who were not involved in the execution of change. The outcome of the thesis provides information how the integration process was experienced amongst personnel and concrete development proposals for possible future integration processes.

As conclusion, the integration process was seen to be well executed in general. Especially communication on general level and the presence of top management throughout the integration process received positive feedback. Practices of direct managers during change were seen mostly positive. The biggest cause for concern seemed to be the postponement of launching the new organization and the uncertainties caused by this, especially on an individual level regarding the employee’s own future. Personnel also wished they had more opportunities to be involved in change.

Therefore, this thesis recommends that managers at all levels receive change management training especially on how to address personnel’s emotions during change. Managers should also provide possibilities for their team to discuss about change and express their opinions. Additionally, it should be ensured communication is clear and cascades down throughout the organization.