The Impact of Transformational Leadership and Leader-Member Exchange on Socialization in Mergers and Acquisitions

Abstract

The world of mergers and acquisitions are often fraught with change, loss of identity and uncertainty for the workers who remain. The consolidation of work-groups can result in new roles, unfamiliar faces, new social structure and the introduction of foreign processes. The need to quickly establish new social networks and social groups are essential to reestablish the individual’s sense of belonging, comfort with the new organization and secure the future to support productivity. Leaders assigned the responsibility for executing work-group consolidations or the integration of business units to a new organization play a key role in support of employee adjustment. A successful leader will recognize the contribution that Transformational Leadership skills play to facilitate the re-socialization of the work-groups by leveraging Leader-Member Exchange and extolling a clear concise vision with which followers can identify. The following proposal establishes a mechanism to empirically demonstrate the effectiveness of Transformational Leadership and LMX in the post-M&A socialization of work groups.