IDEAS home Printed from https://ideas.repec.org/a/dij/revfcs/v5y2002iq1p5-42.html
   My bibliography  Save this article

Biais cognitifs du dirigeant, conséquences et facteurs de renforcement lors de fusions-acquisitions:synthèse et illustrations

Author

Listed:
  • Michel Barabel
  • Olivier Meier

    (Université de Paris 12)

Abstract

Mergers and acquisitions generally lead to disappointing results. In this article, we give a complementary explanation of these bad results by focusing on a specific actor:the CEO of the purchasing company. In particular, this research addresses two questions:(1) What mistakes (related to cognitive biases) are made by the managers of purchasing companies during mergers and acquisitions ? (2) Given the context and characteristics of specific acquisitions, what factors increase the risk of mistakes by managers ?

Suggested Citation

  • Michel Barabel & Olivier Meier, 2002. "Biais cognitifs du dirigeant, conséquences et facteurs de renforcement lors de fusions-acquisitions:synthèse et illustrations," Revue Finance Contrôle Stratégie, revues.org, vol. 5(1), pages 5-42, March.
    • Handle: RePEc:dij:revfcs:v:5:y:2002:i:q1:p:5-42
    as

    Download full text from publisher

    File URL: https://repec-crego.u-bourgogne.fr/images/stories/rev/051042.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Slusky, Alexander R & Caves, Richard E, 1991. "Synergy, Agency, and the Determinants of Premia Paid in Mergers," Journal of Industrial Economics, Wiley Blackwell, vol. 39(3), pages 277-296, March.
    2. Shleifer, Andrei & Vishny, Robert W., 1989. "Management entrenchment : The case of manager-specific investments," Journal of Financial Economics, Elsevier, vol. 25(1), pages 123-139, November.
    3. Morck, Randall & Shleifer, Andrei & Vishny, Robert W, 1990. "Do Managerial Objectives Drive Bad Acquisitions?," Journal of Finance, American Finance Association, vol. 45(1), pages 31-48, March.
    4. Richard A. Bettis & C. K. Prahalad, 1995. "The dominant logic: Retrospective and extension," Strategic Management Journal, Wiley Blackwell, vol. 16(1), pages 5-14.
    5. Irene M. Duhaime & John H. Grant, 1984. "Factors influencing divestment decision‐making: Evidence from a field study," Strategic Management Journal, Wiley Blackwell, vol. 5(4), pages 301-318, October.
    6. Olivier Meier, 2000. "La croissance externe symbiotique:enjeux et perspectives," Revue Finance Contrôle Stratégie, revues.org, vol. 3(4), pages 113-141, December.
    7. repec:dau:papers:123456789/3390 is not listed on IDEAS
    8. Robin M. Hogarth & Spyros Makridakis, 1981. "Forecasting and Planning: An Evaluation," Management Science, INFORMS, vol. 27(2), pages 115-138, February.
    9. Michel Barabel, 2001. "Cognitive and behavioral bias of CEOs in the merger and acquisition process: an overview of existing theory," Post-Print hal-00157400, HAL.
    10. Page, Benjamin I., 1976. "The Theory of Political Ambiguity," American Political Science Review, Cambridge University Press, vol. 70(3), pages 742-752, September.
    11. James G. March, 1978. "Bounded Rationality, Ambiguity, and the Engineering of Choice," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 587-608, Autumn.
    12. Frank T. Paine & Daniel J. Power, 1984. "Merger strategy: An examination of Drucker's five rules for successful acquisitions," Strategic Management Journal, Wiley Blackwell, vol. 5(2), pages 99-110, April.
    13. Roll, Richard, 1986. "The Hubris Hypothesis of Corporate Takeovers," The Journal of Business, University of Chicago Press, vol. 59(2), pages 197-216, April.
    14. Richard A. Bettis, 1981. "Performance differences in related and unrelated diversified firms," Strategic Management Journal, Wiley Blackwell, vol. 2(4), pages 379-393, October.
    15. Mueller, Dennis C., 1989. "Mergers : Causes, effects and policies," International Journal of Industrial Organization, Elsevier, vol. 7(1), pages 1-10, March.
    16. T.K. Das & Bing‐Sheng Teng, 1999. "Cognitive Biases and Strategic Decision Processes: An Integrative Perspective," Journal of Management Studies, Wiley Blackwell, vol. 36(6), pages 757-778, November.
    17. John B. Kusewitt, 1985. "An exploratory study of strategic acquisition factors relating to performance," Strategic Management Journal, Wiley Blackwell, vol. 6(2), pages 151-169, April.
    18. Goldstein,William M. & Hogarth,Robin M. (ed.), 1997. "Research on Judgment and Decision Making," Cambridge Books, Cambridge University Press, number 9780521483346.
    19. Agrawal, Anup & Jaffe, Jeffrey F & Mandelker, Gershon N, 1992. "The Post-merger Performance of Acquiring Firms: A Re-examination of an Anomaly," Journal of Finance, American Finance Association, vol. 47(4), pages 1605-1621, September.
    20. James H. Barnes, 1984. "Cognitive biases and their impact on strategic planning," Strategic Management Journal, Wiley Blackwell, vol. 5(2), pages 129-137, April.
    21. John W. Hunt, 1990. "Changing pattern of acquisition behaviour in takeovers and the consequences for acquisition processes," Strategic Management Journal, Wiley Blackwell, vol. 11(1), pages 69-77, January.
    22. Suzana Braga Rodrigues & David J. Hickson, 1995. "Success In Decision Making: Different Organizations, Differing Reasons For Success," Journal of Management Studies, Wiley Blackwell, vol. 32(5), pages 655-678, September.
    23. Ravenscraft, David J. & Scherer, F. M., 1989. "The profitability of mergers," International Journal of Industrial Organization, Elsevier, vol. 7(1), pages 101-116, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Anne-Sophie Thelisson & Olivier Meier, 2022. "Managerial biases during a merger process in a government-controlled organization," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 26(4), pages 1315-1338, December.
    2. Gérard Charreaux, 2005. "Pour une gouvernance d’entreprise «comportementale»:une réflexion exploratoire-Toward a Behavioral Corporate Governance Theory : An Exploratory View," Working Papers CREGO 1050601, Université de Bourgogne - CREGO EA7317 Centre de recherches en gestion des organisations.
    3. Meier, Olivier & Schier, Guillaume, 2014. "Family firm succession: Lessons from failures in external party takeovers," Journal of Family Business Strategy, Elsevier, vol. 5(4), pages 372-383.
    4. repec:dau:papers:123456789/1144 is not listed on IDEAS

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Meier, Olivier & Schier, Guillaume, 2014. "Family firm succession: Lessons from failures in external party takeovers," Journal of Family Business Strategy, Elsevier, vol. 5(4), pages 372-383.
    2. Schön, Benjamin & Pyka, Andreas, 2013. "The success factors of technology-sourcing through mergers & acquisitions: An intuitive meta-analysis," FZID Discussion Papers 78-2013, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    3. Martynova, M. & Renneboog, L.D.R., 2006. "The Performance of the European Market for Corporate Control : Evidence from the 5th Takeover Wave," Other publications TiSEM af864e61-b989-415e-ba58-7, Tilburg University, School of Economics and Management.
    4. Renneboog, Luc & Vansteenkiste, Cara, 2019. "Failure and success in mergers and acquisitions," Journal of Corporate Finance, Elsevier, vol. 58(C), pages 650-699.
    5. Shelton, Lois M., 2000. "Merger market dynamics: insights into the behavior of target and bidder firms," Journal of Economic Behavior & Organization, Elsevier, vol. 41(4), pages 363-383, April.
    6. Martynova, M. & Renneboog, L.D.R., 2005. "Takeover Waves : Triggers, Performance and Motives," Discussion Paper 2005-029, Tilburg University, Tilburg Law and Economic Center.
    7. Hunt, Richard A., 2021. "Entrepreneurial orientation and the fate of corporate acquisitions," Journal of Business Research, Elsevier, vol. 122(C), pages 241-255.
    8. Díaz Díaz, Belén & Sanfilippo Azofra, Sergio & López Gutiérrez, Carlos, 2013. "Synergies or overpayment in European corporate M&A," MPRA Paper 51070, University Library of Munich, Germany.
    9. Etienne Redor, 2016. "Board attributes and shareholder wealth in mergers and acquisitions: a survey of the literature," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 20(4), pages 789-821, December.
    10. David R Merrell, 1999. "Productivity And Acquisitions In U.S. Coal Mining," Working Papers 99-17, Center for Economic Studies, U.S. Census Bureau.
    11. Olivier MEIER & Aurélie SANNAJUST, 2014. "Public to Private transactions and cognitive biases: A European study," Working Papers 2014-345, Department of Research, Ipag Business School.
    12. Fabian Homberg & Katja Rost & Margit Osterloh, 2009. "Do synergies exist in related acquisitions? A meta-analysis of acquisition studies," Review of Managerial Science, Springer, vol. 3(2), pages 75-116, July.
    13. Martynova, Marina & Renneboog, Luc, 2008. "A century of corporate takeovers: What have we learned and where do we stand?," Journal of Banking & Finance, Elsevier, vol. 32(10), pages 2148-2177, October.
    14. Baldi, Francesco & Salvi, Antonio, 2022. "Disentangling acquisition premia: Evidence from the global market for corporate control," Finance Research Letters, Elsevier, vol. 48(C).
    15. Martynova, M., 2006. "The market for corporate control and corporate governance regulation in Europe," Other publications TiSEM 8651e281-4914-41f2-ac14-1, Tilburg University, School of Economics and Management.
    16. Ilaria Galavotti, 2019. "Firm-level recent profitability and acquisition performance: exploring competing theoretical perspectives," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 9(3), pages 319-345, September.
    17. Bhabra, Harjeet S. & Huang, Jiayin, 2013. "An empirical investigation of mergers and acquisitions by Chinese listed companies, 1997–2007," Journal of Multinational Financial Management, Elsevier, vol. 23(3), pages 186-207.
    18. Gilles Guieu, 1999. "Processus de prise de contrôle et changement organisationnel:la diversité des relations," Revue Finance Contrôle Stratégie, revues.org, vol. 2(2), pages 71-95, June.
    19. Jeffrey Harrison & Matthew Hart & Derek Oler, 2014. "Leverage and acquisition performance," Review of Quantitative Finance and Accounting, Springer, vol. 43(3), pages 571-603, October.
    20. Sam Y. Cho & Jonathan D. Arthurs & David M. Townsend & Douglas R. Miller & Jeffrey Q. Barden, 2016. "Performance deviations and acquisition premiums: The impact of CEO celebrity on managerial risk‐taking," Strategic Management Journal, Wiley Blackwell, vol. 37(13), pages 2677-2694, December.

    More about this item

    Keywords

    cognitive bias; dysfonctional cognitive processes; managerial mistakes; mergers and acquisitions;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • M20 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:dij:revfcs:v:5:y:2002:i:q1:p:5-42. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Informatique Technique MSH Dijon (email available below). General contact details of provider: http://www.revues.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.