Document Type
Article
Publication Date
1-1-2015
Abstract
This study contributes to a better understanding of voluntary executive turnover during the post-merger integration period by extending prior research on agency, stewardship, and psychological contracts. Within the context of a post-acquisition environment we propose four new predictors of engagement, measure the mediating role of a decision to leave, and examine the moderating effects of retention incentives and perceived implicit contract violations. This inquiry was inspired by the seemingly counter-intuitive industry practice of assigning retention incentives to key talent who are not actually committed to staying and the likelihood that subsequent agent engagement in the organizational change process required for value creation might be diluted. Our goal was to fill a decided lack of validated research in the literature on this phenomena. Using Structural Equation Modeling we tested our construct using data gathered from survey responses completed by 204 recently acquired executives in nearly two dozen companies. We confirmed that the decision to leave does significantly impact subsequent engagement and that both incentives and perceived contract violations significantly moderate the relationships proposed in our construct.
Keywords
executive succession, organizational change, consolidation and merger of corporations, Weatherhead School of Management, post-merger integration, executive turnover, incentives, contract violations, engagement; mergers and acquisitions
Rights
© The Author(s). This is an open access work distributed under the terms of the Creative Commons Attribution-Non-Commercial (https://creativecommons.org/licenses/by-nc/4.0/) which permits non-commercial reuse, distribution, and reproduction in any medium, provided the original work is properly cited.
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
Department/Center
Design & Innovation
Recommended Citation
Grogan, David P., "The Moderating Effects of Incentives and Informal Contracts on Post-Merger Executive Turnover and Engagement" (2015). Student Scholarship. 465.
https://commons.case.edu/studentworks/465