Abstract for: Implementation Strategies and Post-Merger Integration Performance Outcomes

Research has not converged on a set of factors that reliably explain the variance in post-merger integration (PMI) performance, and scholars have called for new theory building to fill this gap. This paper combines an in-depth field study, causal loop diagramming, and simulation modelling to build a process theory of PMI over time. From our field data, we identify four common PMI performance trajectories over time and develop a simulation model capable of generating all four different performance outcomes. Simulation analyses highlight the important role of several interconnected feedback processes that have not been identified in prior work: (1) the ‘Achieving target synergy’ balancing loop, (2) ‘Integration fatigue and Low monitoring’ reinforcing loop, (3) ‘Integration fatigue and Burn out’ reinforcing loop, and (4) ‘Pressure to accelerate and Stress’ reinforcing loop. Results show how differences in implementation strategies for PMI lead to different performance outcomes. One performance outcome, the Death Spiral, arises when managerial decisions to accelerate synergy realisation and generate new synergies, increase fatigue and uncertainty, and undermine engagement, capabilities, and synergy realisation.