Cross-cultural competence and social capital dynamic process in cross-border M&A, a theoretical framework based on a multi-case study

Abstract

Purpose In the process of cross-border mergers and acquisitions (M&A), the social capital of enterprises is dynamic. In this context, cross-cultural competence plays an important role and can affect the transformation process of social capital and further influence the realisation of M&A performance. However, there is still not enough research on the process of social capital transformation and corporate cross-cultural competence. This study aims to explore the influence mechanism of social capital and the cross-cultural competence of enterprises. Design/methodology/approach In this paper, four typical manufacturing M&A case studies were analysed and a grounded theoretical analysis process was used to explore the structure of cross-cultural competence and its impact on the dynamic process of social capital. Findings The results of this study imply that social capital experiences three stages of transformation in the process of M&A. There are also four dimensions of corporate cross-cultural competence, which are composed of various factors. These all affect the dynamic process of social capital through different influence mechanisms. Originality/value According to the results, a mechanism model was composed to determine how corporate cross-cultural ability affects the social capital process. This is of practical significance as it can enhance the performance of M&A integration in a cross-cultural context.