The elusive value contribution of IS in M&A: How does IS integration influence the value contribution of IS in mergers and acquisitions (M&A)?

SUMMARY The research explores the value contribution of IS in M&A. Integration of IS in M&A poses short and long-term challenges. Typical challenges include time pressure and information access limitations in the pre-merger phase, and broader themes such as synergy identification and realization, underestimated differences, assumption validation, and resource allocation in the execution phase. The study starts with an overview and synthesis of the influential IS papers published over 30 years. Outcomes include the conceptualization of direct and indirect IS value contributions based on a IS investment framework developed by Broadbent and Weill. Four conditions influencing IS value are outlined: previous experience, execution capability, technical distance, and external pressure. The research examines negative value creation from IS integration in M&A through case studies and expert interviews. This approach identifies IS Antagonism—a destructive interaction between independently developed information systems, during operational integration—as a cause of negative value. Four types of antagonism are outlined, and the concept received recognition at the ICIS 2022 conference. The third study addresses IS architecture complexity dynamics, noting that complexity often increases despite efforts to consolidate during M&A. Two case studies reveal that underestimated pre-merger complexity and temporary measures contribute to increased complexity. The findings, presented at ECIS 2023, underline the significance of requisite complexity. The fourth study investigates deviations from intended IS integration strategies. It reveals five M&A-specific factors influencing these deviations, including information collection limitations pre-merger and governance structures impacting and steering integration during the execution phase. Deviations impact priorities for synergy realization, especially reducing the priority of achieving economies of scale. These insights were shared at the ECIS 2024 conference. Overall, the research highlights the intricate dynamics of IS integration in M&A, emphasizing the need for detailed understanding of IS characteristics to optimize the IS value contribution. The research concludes with practical recommendations for improving IS due diligence, validating assumptions, managing complexities, mitigating antagonism, and optimizing resource allocation.