Overcoming Knowledge Gaps in Postmerger Integration: A Case Study

Over 50% of mergers and acquisitions (M&As) fail, mainly because of integration problems. In such integrations, much of the experiential (learning-by-doing) knowledge critical for running the business becomes redundant or is lost. However, we know virtually nothing about what type of mechanisms best facilitate overcoming the gaps in experiential knowledge in these dynamic hybrid organizational situations. We study a case of integration of software-maintenance processes after a megamerger. In the first phase of the integration, the company combined best features of existing knowledge systems. However, high customer dissatisfaction and low key performance indicators followed. This led to the need to reframe the task into one of creating a new, better process. This led to satisfactory outcomes. Six key elements facilitated the transfer or creation of experiential knowledge: defining content of change, integrating information systems, leadership, joint collaboration, acquiring knowledge externally, and relocating personnel.