‘Change is Our Continuity’: Chinese Managers’ Construction of Post-Merger Identification After an Acquisition in Europe

ABSTRACT

This article examines organizational identification construction in mergers and acquisitions (M&As). The majority of existing studies have focused on antecedents and outcomes of post-merger identification (PMI) in Western contexts. While more and more Chinese cross-border M&As are taking place, how Chinese employees construct PMI remains underexplored. We adopted a qualitative case study approach to investigate how Chinese managers construct PMI after acquiring a European company. As the main contribution, we introduce the concept of agile organizational identity (AOI), wherein agility is a central, enduring and distinctive characteristic of an organization, i.e. ‘who we are and who we want to be’. Our findings reveal that AOI is leveraged by Chinese managers to deal with their perceived inferior status, help them cope with the change and contribute to the construction of a strong PMI. We believe that our study provides a new perspective on how employees can effectively cope with organizational change while maintaining a sense of identity continuity.

MAD statement

This article examines organizational identification construction in mergers and acquisitions (M&As). We provide novel insights by introducing the agile organizational identity (AOI) concept, wherein the agility is a central, enduring and distinctive characteristic of an organization, i.e. ‘who we are and who we want to be’. To maintain such a pre-merger identity after M&As, people strive to continue changing as change is the continuity. Thus, psychological bonds between an employee and the employing organization do not become weaker. As agility is incorporated in the organizational identity, AOI helps employees to cope with the low status of their organization, accept organizational changes, and identify with the post-merger organization. Organizational leaders might want to foster AOI in order to successfully conduct strategic change initiatives.

KEYWORDS:

• Agile organizational identity
• change
• M&As
• post-merger identification
• perceived inferior status

Acknowledgements

We are grateful to our interviewees who gave their time so generously, and whose insights were so valuable to our study. This work was supported by the Swiss National Research Foundation (SNSF) under Grant number 163106.

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by Swiss National Science Foundation [grant number 163106].

Notes on contributors

Shuang Liang

Shuang Liang holds a doctorate degree in psychology from Zürich University (2020). Her research interests lie in the field of organizational behaviour and culture, behavioural economics, Social Identity Theory, and agile organizations. She is engaged in cross-cultural behavioural research and Sino-Western collaborations.

Anna Lupina-Wegener

Anna Lupina-Wegener is Professor of Management at the School of Management and Engineering Vaud, HES-SO (University of Applied Sciences and Arts Western Switzerland). She investigates socio- cultural integration processes in cross- border mergers and acquisitions (M&As), change- and internationalization processes. In cross-cultural settings, she is interested in how managers, engineers and entrepreneurs develop collaborations with multiple stakeholders and how they overcome interpersonal, intergroup or interorganizational conflicts.

Johannes Ullrich

Johannes Ullrich is Professor of Social Psychology at the University of Zurich, Switzerland. His research interests are mainly in Social Cognition, Group Processes and Intergroup Relations. He has a PhD in Psychology from Philipps-University, Marburg, Germany. His Venia Legendi was awarded to him in 2009 by Goethe University, Frankfurt, Germany, based on his Habilitation on the topic ‘Identification with Organizations’.

Rolf van Dick

Rolf van Dick is Professor of Social Psychology at Goethe University Frankfurt (Germany) and serves as Vice President for International Affairs and Early Career Researchers. Prior to his current position he was Professor at Aston Business School, Birmingham (UK). Rolf van Dick is scientific director of the interdisciplinary Center for Leadership and Behavior in Organizations (CLBO). He has published/edited around 20 books and special issues, and over 250 book chapters and papers in academic journals such as the Academy of Management Journal, Journal of Organizational Behaviour, Journal of Applied Psychology, Journal of Marketing, Journal of Business Ethics, or the Journal of Personality and Social Psychology. Rolf was visiting professor in Tuscaloosa (USA), on Rhodes (Greece), in Shanghai and Bejing (China), Rovereto (Italy), in Oslo (Norway), and in Kathmandu (Nepal) and he was editor/associate editor of the British Journal of Management, the European Journal of Work and Organizational Psychology, the Journal of Personnel Psychology, and The Leadership Quarterly. His research is in the area of social identity processes and he applies social identity theory to topics such as leadership, mergers & acquisitions, health and stress, or diversity. He is a Fellow of the International Association of Applied Psychology.