Impact of psychological capital on the resistance to change during post-merger integration

Abstract

Purpose Mergers and acquisitions (M&As) are major corporate changes and are among the most stressful for employees. Employee resistance is a well-recognised reason for high failure rates of post-merger integration (PMI). The contemporary concept of psychological capital (PsyCap) is a promising approach for dealing with the issue. To date, relatively little research has been conducted on the relationship between PsyCap and resistance. The purpose of this paper is to examine the possible positive impacts of PsyCap on employee resistance during PMI, based on a review of the existing literature and selected interviewers with a panel of experts, and offer a theoretical model for decreasing the resistance. Design/methodology/approach This paper builds on the literature on M&A, PMI, and employee resistance by focusing on the contribution of PsyCap. Apart from formulating propositions and answering pre-determined research questions, the findings are the basis for a theoretical model that was validated by a panel of experts. Findings This research documents the negative emotions that are triggers for resistance during PMI under the influence of PsyCap. By measuring and assessing the PsyCap needs of employees, resistant employees were revealed, and their PsyCap was developed using tailored interventions. The research findings indicate this to be a feasible approach for reducing resistance during PMI. Research limitations/implications All of the findings rely on empirical testing and operationalisation. Cultural differences may influence the PsyCap dimensions. Practical implications M&A deals often fail due to unsuccessful PMI implementation because leaders fail to consider the psychological impacts when trying to overcome resistance. The model proposes a possible solution. Originality/value The offered theoretical approach is original and provides new insights for researchers and practitioners who evaluate M&A strategies.

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