Mitigation of Overcommitment in M&A Decision-Making: Explorations from the Lab and the Field

Item Type Conference or Workshop Item (Paper)

The prevalence of managerial biases is well documented in strategy research. Yet, we know relatively little about their potential mitigation. In this study, we explore the mitigation of managerial overcommitment in the M&A decision-making process. Drawing on the psychology literature we propose two distinct mitigation approaches: Oppositive reasoning, which actuates the consideration of outcomes that are diametrically opposed to currently hold assumptions, and disclosive reasoning, where the anticipation of justification requests prompts a more careful evaluation of information. In an experimental study, we find significant evidence for the effectiveness of both debiasing strategies. We then examine these approaches outside of the lab. Drawing on qualitative field data of 32 M&A departments, we explore the adoption and perceived impediments of these approaches in organizations with different organizational structures.

Authors Theisen, Michael & Welch Guerra, Xena
Language English
Keywords Behavioral Theory, Decision Processes, M&A
Subjects business studies
HSG Classification contribution to scientific community
Date 30 October 2020
Event Title SMS 40th Annual Conference
Event Location London, UK
Event Dates October 19-30, 2020
Contact Email Address
Depositing User Michael Theisen
Date Deposited 11 Jan 2021 13:00
Last Modified 11 Jan 2021 13:00


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Theisen, Michael & Welch Guerra, Xena: Mitigation of Overcommitment in M&A Decision-Making: Explorations from the Lab and the Field. 2020. - SMS 40th Annual Conference. - London, UK.

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