In corporate acquisitions, managers construct an impression of control

The early integration phase following a corporate acquisition requires tolerance of uncertainty.

Business managers are in a conflicting situation, as they are expected to manage decisions and situations they are facing during the early integration with confidence. However, the various different versions of the early integration, which managers construct when interviewed, reveal the challenges and uncertainties of the transition phase, Laura Erkkilä, M.Sc. (Econ.), states in her doctoral dissertation to be examined at Aalto University School of Business on 11 December.

‘Traditionally the acquiring company is expected, inter alia, to take control of the acquired company by creating a control system in accordance with the level of integration for running the acquired company,’ Erkkilä points out.  

Previous studies have often been based on the understanding of the integration from the perspective of the acquiring party, highlighting a rational and manageable integration process.  

Erkkilä's doctoral dissertation provides new information on how corporate leaders and business managers in both the acquiring company and the acquired one experience the early integration and cope with the pressures created by it. Even though all managers create an impression of control of the situation in their talk, the analysis of how they speak exposes ‘in-control’ elements as well as opposite elements, which disrupt the impression of control. Using these elements managers reveal that situations are at the same time also beyond their control.

‘By building up an impression of control, managers fundamentally fulfil a social obligation for control. This is based on a strong leadership culture that emphasises the manager's responsibility to be credible, solve problems and be in control,’ says Erkkilä.

The managers of the acquired company also participate in creating the impression of control. They do it by highlighting their own personal strengths and experience as well as those of the whole former organization.

Control-based talk may distance people

The study opens new perspectives on the development of integration in such a manner that the managers of the acquired company participate in taking control of the early integration.

‘Successful outcomes can be promoted by making integration and being in control of it a common goal and responsibility. A common understanding of the priorities of the new organization during the initial phase of integration is also necessary. The current conception of good integration is no longer based on strong control only, but on mutual commitment and participation,’ Erkkilä points out.

Erkkilä notes that the corporate management's overemphasis on talk about the manageability of the initial integration may contradict with the experiences of the acquired company or even the entire personnel. She, therefore, calls for open communication about the challenges of early integration to avoid escalation of diverging views into resistance.

Further information:
Laura Erkkilä
tel. +358 40 778 0451
[email protected]

  • Published:
  • Updated:
Share
URL copied!

Related news

Head of Post-Award Services Jukka Hyvönen and Head of Pre-Award Services Sanna-Maija Kiviranta
Appointments, Research & Art Published:

New Service Heads at Research Services

Sanna-Maija Kiviranta has been appointed as Head of Pre-Award Services and Jukka Hyvönen has been appointed as Head of Post-Award Services. Both teams support Aalto University's researchers in research funding.
A false colour electron microscope image of the bolometer, the scale bar shows a single bacteria, indicating how small the device is
Research & Art Published:

Radiation detector with the lowest noise in the world boosts quantum work

The nanoscale radiation detector is a hundred times faster than its predecessors, and can function without interruption
The details avaiable on the page in a picture with a colourful cartoon of an antropomorphic qubit
Campus, Research & Art Published:

From quantum gateways to super-refrigerators – the quantum technology revolution arrives in Otaniemi

An exhibition uncovering the secrets of quantum technology is opening on 17 October as part of the quantum technology summit
Kuva: Mostphotos
Cooperation, Research & Art Published:

Helsinki Brain & Mind, a new neuroscience hub, awar­ded ERDF fund­ing

The European Regional Development Fund has awarded €500,000 to the University of Helsinki, Aalto University and the Helsinki University Hospital for the development of a research, competence and innovation hub in neuroscience.