Firm Performance Before and After Horizontal Merger and Acquisition Effectiveness and Efficiency Performance on Hotel Industry in Indonesia

Adi Sopyan

doi:10.3333/lbs.v11i1.63

Authors

Adi Sopyan Sekolah Tinggi Manajemen Pariwisata dan Logistik Lentera Mondial

DOI:

https://doi.org/10.3333/lbs.v11i1.63

Keywords:

Effectiveness, Efficiency cost, Firm Performance, Horizontal Merger and Acquisition, Indonesia Hotel Industry

Abstract

The literature frequently highlights synergy as the main goal behind M&As, research often shows a lack of success, casting doubt on the potential to achieve these synergies. One area that has not been extensively explored is the overall impact of M&As. This study seeks to examine how marketing effectiveness and efficiency influence firm performance, and how these effects vary before and after a horizontal M&A. We developed hypotheses and tested them Hotel Industry in Indonesia. Our results indicate that marketing effectiveness positively impacts firm performance both before and after the M&A, with a stronger effect observed after the M&A. Conversely, efficiency does not affect firm performance before the M&A but shows a positive impact afterward.

Downloads

Download data is not yet available.

References

Azcentral (2018) The 10 biggest mergers and acquisitions of 2018.

Campa JM, Hernando I (2006) M&As performance in the European financial industry. Journal of Banking & Finance 30 (12):3367-3392

Cassiman B, Colombo MG, Garrone P, Veugelers R (2005) The impact of M&A on the R&D process: An empirical analysis of the role of technological- and market-relatedness. Research Policy 34 (2):195-220. doi:10.1016/J.RESPOL.2005.01.002

Chung Y, Kim AJ (2019) Effects of mergers and acquisitions on brand loyalty in luxury Brands: The moderating roles of luxury tier difference and social media. Journal of Business Research. doi:10.1016/J.JBUSRES.2019.11.030

Cooper, R. D, Schindler PS (2014) Business Research Method. 14th edn. New York: McGraw-Hill/Irwin,

Cording M, Christmann P, Bourgeois Iii L (2002) A focus on resources in M&A success: a literature review and research agenda to resolve two paradoxes. Academy of Management 12 (8):1-40

Cui H, Leung SC-M (2020) The long-run performance of acquiring firms in mergers and acquisitions: Does managerial ability matter? Journal of Contemporary Accounting & Economics 16 (1):100185

Delong D, McDermott M (2013) Current perceptions, prominence and prevalence of sustainability in the marketing curriculum. Marketing Management Journal 23 (2):101-116

Farris PW, Hanssens DM, Lenskold JD, Reibstein DJ (2015) Marketing return on investment: Seeking clarity for concept and measurement. Applied Marketing Analytics 1 (3):267-282

Fee CE, Thomas S (2004) Sources of gains in horizontal mergers: evidence from customer, supplier, and rival firms. Journal of Financial Economics 74 (3):423-460

Ficery K, Herd T, Pursche B (2007) Where has all the synergy gone? The M&A puzzle. Journal of business Strategy 28 (5):29-35

Gammelgaard J Access to competence: An emerging acquisition motive. In: European Business Forum, 2004. vol 17. Kogan Page, pp 44-47

Ghosh A (2004) Increasing market share as a rationale for corporate acquisitions. Journal of Business Finance & Accounting 31 (1‐2):209-247

Ghozali I (2013) Multivariate Analysis Application with the IBM SPSS 21: Up Date PLS Regression Program.

Gregory A, McCorriston S (2005) Foreign acquisitions by UK limited companies: short-and long-run performance. Journal of Empirical Finance 12 (1):99-125

Grewal R, Slotegraaf RJ (2007) Embeddedness of organizational capabilities. Decision Sciences 38 (3):451-488

Haucap J, Rasch A, Stiebale J (2019) How mergers affect innovation: Theory and evidence. International Journal of Industrial Organization 63:283-325. doi:10.1016/J.IJINDORG.2018.10.003

Hendrayati H, Gaffar V (2016) Innovation and Marketing Performance of Womenpreneur in Fashion Industry in Indonesia. Procedia - Social and Behavioral Sciences 219:299-306. doi:https://doi.org/10.1016/j.sbspro.2016.04.034

Homberg F, Rost K, Osterloh M (2009) Do synergies exist in related acquisitions? A meta-analysis of acquisition studies. Review of Managerial Science 3 (2):75-116

Homburg C, Grozdanovic M, Klarmann M (2007) Responsiveness to customers and competitors: the role of affective and cognitive organizational systems. Journal of Marketing 71 (3):18-38

Keh HT, Chu S, Xu J (2006) Efficiency, effectiveness and productivity of marketing in services. European Journal of Operational Research 170 (1):265-276. doi:https://doi.org/10.1016/j.ejor.2004.04.050

Kengelbach J, Roos AW (2011) Riding the Next Wave in M & A: Where are the Opportunities to Create value? Boston Consulting Group, Incorporated,

Khanal AR, Mishra AK, Mottaleb KA (2014) Impact of mergers and acquisitions on stock prices: The U.S. ethanol-based biofuel industry. Biomass and Bioenergy 61:138-145. doi:10.1016/J.BIOMBIOE.2013.12.004

Kiesel F, Ries JM, Tielmann A (2017) Reprint of “The impact of mergers and acquisitions on shareholders’ wealth in the logistics service industry”. International Journal of Production Economics 194:261-277. doi:10.1016/J.IJPE.2017.11.007

King DR, Dalton DR, Daily CM, Covin JG (2004) Meta‐analyses of post‐acquisition performance: Indications of unidentified moderators. Strategic management journal 25 (2):187-200

KPMG (2011) Mergers and acquisitions survey.

Kreitl G, Oberndorfer WJ (2004) Motives for acquisitions among engineering consulting firms. Construction management & economics 22 (7):691-700

Lee H-M, Lee C-C, Wu C-C (2011) Brand image strategy affects brand equity after M&A. European journal of marketing 45 (7/8):1091-1111

Martynova M, Renneboog L (2008) A century of corporate takeovers: What have we learned and where do we stand? Journal of Banking & Finance 32 (10):2148-2177

Mavondo FT, Chimhanzi J, Stewart J (2005) Learning orientation and market orientation: Relationship with innovation, human resource practices and performance. European journal of marketing 39 (11/12):1235-1263

Modi SB, Mishra S (2011) What drives financial performance–resource efficiency or resource slack?: Evidence from US based manufacturing firms from 1991 to 2006. Journal of Operations Management 29 (3):254-273

Narasimhan R, Talluri S (2009) Perspectives on risk management in supply chains. Elsevier,

Rahman M, Lambkin M (2015) Creating or destroying value through mergers and acquisitions: A marketing perspective. Industrial Marketing Management 46:24-35. doi:https://doi.org/10.1016/j.indmarman.2015.01.003

Rahman M, Rodríguez-Serrano MÁ, Lambkin M (2017) Corporate social responsibility and marketing performance: The moderating role of advertising intensity. Journal of Advertising Research 57 (4):368-378

Reuters T (2017). https://www.thomsonreuters.com.

Reuters T (2018). https://www.thomsonreuters.com.

Roll R (1986) The hubris hypothesis of corporate takeovers. Journal of business:197-216

Sheth J (2009) Beyond customer satisfaction: how to retain satisfied customers.

Sheth JN, Sisodia RS (2002) Marketing productivity: issues and analysis. Journal of Business research 55 (5):349-362

Sun S, Zhao H, He X, Zhang Y (2019) The impact of accounting standards convergence on Chinese firms’ overseas mergers and acquisitions. China Journal of Accounting Research 12 (3):231-250. doi:10.1016/J.CJAR.2019.05.001

Tuch C, O’Sullivan N (2007) The impact of acquisitions on firm performance: A review of the evidence. International journal of management reviews 9 (2):141-170

Wang R-T, Ho C-TB, Oh K (2010) Measuring production and marketing efficiency using grey relation analysis and data envelopment analysis. International Journal of Production Research 48 (1):183-199

Zhang W, Wang K, Li L, Chen Y, Wang X (2018) The impact of firms’ mergers and acquisitions on their performance in emerging economies. Technological Forecasting and Social Change 135:208-216