The Dynamics of Organizational Autonomy: Oscillations at Automobili Lamborghini

Through a 21-year longitudinal study of the relationship between Italian supercar manufacturer Automobili Lamborghini and its parent, German carmaker Audi AG, we examine how a unit’s degree of organizational autonomy is renegotiated over long periods of time. Using detailed empirical data, we develop a process model of the dynamics of organizational autonomy in a unit–parent relationship. This process model shows an ongoing dialectical tension between parent managers’ autonomy-reduction efforts and unit managers’ autonomy-extension efforts, and it reveals oscillations in the unit managers’ discretion over resource-orchestration decisions. Driving this dialectic are parent managers’ appraisal respect for the unit, their search for firm-wide strategic integration, and unit managers’ organizational identity and concern for distinctiveness. Our process model captures concurrent feedback loops that endogenously produce these oscillations between lower and higher autonomy. We then conceptualize a harmonic domain in the unit–parent relationship, in which these oscillations persist without deviating toward amalgamation or separation. Finally, we develop a theory of change in autonomy by identifying a theoretical link between resource orchestration and specific dimensions of organizational identity. Our study highlights the dialectical, dynamic, and ongoing nature of organizational autonomy.Brice Dattée thankfully acknowledges the sustained research funding provided by emlyon business school

Autonomy as a Strategic Dial: A Dynamic Framework for Managing Acquired Subsidiaries

Managing acquired subsidiaries can be daunting. Parent and affiliate executives strive to co-create value, but fixed mindsets around subsidiary autonomy can result in diverging interests and outcomes. Through a longitudinal study of Audi’s post-acquisition integration of supercar manufacturer Lamborghini, this article provides guidance on how to manage the level of acquired subsidiary autonomy as a strategic dial that can be dynamically adjusted over time for mutual benefit. This dynamic approach to autonomy rests on three specific managerial levers—appraisal respect, organizational identity, and resource orchestration. These can enable the renewal of competitive capabilities and sustain post-acquisition success

A new research agenda for managing socio-cultural integration

Post-acquisition socio-cultural integration has received increasing attention from both scholars and practitioners since the early 1990s. During the past decade, research has increasingly focused on emotions and identity in mergers and acquisitions. This chapter introduces the reader to the vibrant research field and its relevance. This section sets the scene for the book, which provides a deeper understanding of how emotions—both positive and negative—as well as values and identity enable a deeper socio-cultural integration after a merger or acquisition, and how leadership plays a crucial role in making it all happen. This chapter also highlights how the Nordic approach to post-acquisition socio-cultural integration refers to a large community of Nordic academics focusing on the softer social and human side of acquisition, often relying on a huge variety of qualitative methods, and to Nordic companies that are not afraid of adopting a more collaborative approach to post-acquisition integration

Does M&A strategy matter? A contingency perspective

This paper takes a contingency approach to investigate whether there are market performance variations for different types of M&A. Eight different types of M&A are identified in a typology based upon the conjunction of three contextual dimensions: external environmental, acquiring firm level strategy and CEO motivation.  Drawing upon a sample of 1,926 domestic UK deals we evaluate the typology to determine whether the financial markets distinguish between different types of M&A. Results indicate significant market and risk-adjusted performance differences by M&A type. These confirm that a contingency approach to M&A performance has merit. We suggest that the proposed integrated typology, that recognises the importance of multiple aspects of strategic fit to M&A performance, addresses the paradox that M&A practitioners continue to pursue deals despite widespread acceptance that they result in high failure rates

Organizational Political Ideology, Host Country Institutions, and Impact on Employee Outcomes

This chapters draws on the institutional perspective to suggest that in cross-border mergers and acquisitions (M&As), a (mis)alignment between the characteristics of the acquiring organization, (in particular, the acquirer-organization’s political ideology) and the institutional environment of the host country (employment regulations, in particular), has an effect on employee outcomes as a consequence of the M&A process. Prior research on cross-border M&As tends to adopt an overtly economic, or cultural, approach, to explain the outcomes of cross-border M&As. Research in corporate governance and other cognate fields, however, shows the fruitfulness of a multi-level processual lens to understand the impact of these deals on organizations. This conceptual chapter aims to extend this body of work by drawing on the role theory perspective to theorize how employees may be affected by cross-border M&As and illuminates the consequences of this mismatch at different levels of the organization.Full Tex