Exploring Employee Attachment: The Case of a Cross-border Merger

Abstract

The purpose of this research project was to study the development and evolution in time of employee attachment to the organization following a merger/acquisition. A longitudinal approach was taken, using both quantitative and qualitative data. Employee attitudes were studied from two perspectives: (1) a social exchange perspective (with the focus on the exchange relationships that develop between employees and the organization and their impact on employee commitment to the organization) and (2) a social identity perspective (with the focus on the process underlying the development of a common organizational identity).

Daily work, cooperation and communication, as well as remuneration were found to be the main factors influencing employee job satisfaction and organizational commitment following the merger/acquisition. The impact these antecedents had on employee attitudes changed over time, depending on the stage of the integration process.

Employee identification with the post-merger organization was shaped by intergroup and personal interactions, organizational support, and leadership. The evolution in time of organizational identification is linked to the internal developments triggered by the integration process, and the organization’s relationship with its environment (in this case, the relationship between the division under study and its parent company).

Starting from the similarities between organizational commitment and organizational identification – i.e. their affective components, this study proposed a model of employee attachment to the post-merger organization. Based on this model, employee attachment develops through the interaction of social exchange and social identification processes. In turn, these interactions are shaped by the integration strategy and the way it is carried out. By taking a multidisciplinary approach, this study provided a more comprehensive understanding of the factors underlying the development of employee attitudes as well as their dynamics following mergers and acquisitions.