Employees highly committed to the organization are more likely to support change (i.e., the possible merger), while individuals with lower commitment are more likely to resist the pending merger. Perceptions of organizational success, job security, and communication are positively related to organizational commitment.
The 1980s and 1990s have been characterized as eras of organizational restructuring. This organizational restructuring has been manifested in many forms, with mergers and acquisitions becoming particularly prevalent forms of restructuring. In fact, over 15,000 mergers and acquisitions were consummated in the US and OECD countries during 2003 alone, with an estimated value of approximately $2.6 tn. Achieving economies of scale, growth, and diversification are the common objectives of mergers and acquisitions. Obtaining a global presence is also acknowledged as a motive for mergers or acquisitions.
Despite the strategic appeal of mergers and acquisitions, between 55% and 70% of mergers and acquisitions failed to meet the anticipated purpose for obvious reasons such as the exorbitant costs associated with these merger transactions. there is considerable interest in understanding the reasons for this distressing rate of success.
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