MergerAcquisitions – Economy Magazine

Mergers and acquisitions (M&A) are often used by companies to gain strategic momentum, but research has shown that 70-90% of these transactions fail to deliver sustainable value. A team of US sales researchers led by Professor Zachary Hall has found that a lack of sales identification and performance may be a key factor contributing to these failures, particularly at the micro level of socio-cultural factors that occur during the merger.

The researchers examined how mergers and acquisitions of companies with different external images on the personal attitudes of the sales force can affect their performance. If salespeople perceive an image discrepancy, i.e. if the external images of the two companies involved in the M&A process differ, their identification with their own company decreases, which leads to a decline in sales performance.

However, these effects can be actively influenced by the leadership team and the characteristics of the sales force. It is important to consider the potential impact on employee identification when considering mergers and acquisitions. It is also important to use sensitivity and tact when communicating with employees during times of upheaval, and to provide separate coaching and targeted discussions for long-time employees who may be more vulnerable to a decline in identification.

In summary, while M&As are a proven strategic tool, careful consideration of the impact on employees, especially sales, is critical to avoid negative consequences and ensure success.

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