The Retention of Customer Relationships after Mergers and Acquisitions

Abstract

Mergers and acquisitions (M&As) represent a strategic approach for businesses to acquire resources and build competitive advantages. Many studies have investigated the process and results of such resource integration between two firms. Some cases reveal satisfactory results in building asset portfolios, while others uncover downsides after M&As due to conflicts in cultural and system integration. Although the key M&A objective is to expand business operations in providing customers with superior products and services, limited understanding exists in regards to how companies retain the quality of post-merger customer relationships. The research questions of this study are: (1) Do enterprises retain the same quality of CRM after M&A? and (2) How do organizations retain the quality of Customer Relationship Management (CRM) after M&A? To answer the first research question, we collected data from eight banks that underwent M&As in Taiwan from 2004 to 2011, to examine their CRM performances. To answer the second question, we conducted five in-depth case studies from successful and failed CRM cases to understand the important factors about managing CRM during and after M&As. The results find critical and additional influential factors about maintaining and enhancing CRM quality after M&As. These results highlight the importance of measuring and managing CRM during and after a merger and contribute to organizations that plan to develop effective plans for building synergy in CRM after M&As.