Five essentials for successful merger integration: what the aerospace and defense industry knows

Abstract

Purpose

This paper aims to offer an original analysis of how three of the largest aerospace and defense (A&D) companies equipped their organizations for merger integration success.

Design/methodology/approach

Through a multi-case study, this paper explores the post-merger integration process for large-scale transactions completed over a 25-year period. Semi-structured interviews were conducted with industry executives and leading management consultants. The process involved collection of primary data, analysis of secondary data drawn from publicly available company documents and identification of key factors that led to success.

Findings

Five interdependent success factors (Figure 1) support integration teams and capture deal value. Managing the process as a megaproject further facilitates the effectiveness of post-merger integration, enabling leaders to remain laser-focused on integration activity while driving toward a long-term vision for the newly formed organization.

Practical implications

Merger integration has been identified as a primary source of deficiency that prevents acquirers from achieving anticipated results, negatively affecting merger success. Based on the findings of this paper, firms are more likely to create a compelling long-term value creation agenda when five essential factors are combined with a megaproject approach to manage the post-merger integration process.

Originality/value

This study advances current knowledge in the field by responding to requests to further explore the dimensions of merger integration that facilitate success and improve shareholder value, contributing new data to inform extant theories regarding merger integration and megaproject management and adding to the limited research on post-merger integration within the A&D industry.

Citation

Voth, J.M. (2021), "Five essentials for successful merger integration: what the aerospace and defense industry knows", Journal of Business Strategy, Vol. 42 No. 5, pp. 304-314. https://doi.org/10.1108/JBS-02-2020-0045