Fostering Enabling Perceptions of Management Controls During Post-Acquisition Integration

The purpose of this paper is to increase our understanding of how enabling perceptions of new management controls (MCs) can be fostered. We present a case study of an acquisition where the acquirer faces pressure to impose rigid controls on the acquired firm, who, in turn faces a massive restructuring and formalization of its controls. This study examines the response to new inflexible MCs implemented in a top down manner and the factors contributing to enabling perceptions. It shows that positive interpersonal relationships, and mutual trust between the acquirer and acquiree, facilitated enabling perceptions of the MCs. We show that managers actively fostered trust and communicated their intentions behind the design of controls. This helped employees rationalize the controls as tools to help them do their work tasks, i.e. enabling, rather than as a sign of mistrust, i.e. coercive. Positive interpersonal relationships reinforced by regular meetings were a way of providing employees assistance to deal with the problems they encountered through the rigidity of the new controls. This study contributes to the literature on enabling controls by proposing a processual framework based on trust-building activities that facilitates enabling perceptions among the employees. Thus, the study further develops our understanding of the relationship between enabling control and trust