Working under a black cloud: How to sustain organizational identification after a merger

Abstract

This article argues against the merger folklore that maintains that a merger negatively affects well-being and work attitudes primarily through the threat of job insecurity. We hold that the workplace is not only a resource for fulfilling a person's financial needs, but that it is an important component of the self-concept in terms of identification with the organization, as explained by social identity theory. We unravel the key concepts of the social identity approach relevant to the analysis of mergers and review evidence from previous studies. Then, we present a study conducted during a merger to substantiate our ideas about the effects of post-merger organizational identification above and beyond the effects of perceived job insecurity. We recommend that managers should account for these psychological effects through the provision of continuity and specific types of communication. © 2006 British Academy of Management.