The Impact of Mergers and Acquisitions on Employee Satisfaction: Examining Effects on Retention, Morale and Productivity

Abstract

The study aimed to explore the impact of mergers and acquisitions (M&As) on both financial performance and employee satisfaction in Indian commercial banks. Specifically, the study examined how M&A activities influence employee retention, morale, and productivity, and how these human resource factors, in turn, affect the overall financial performance of the banks.  The study gathers information from Indian bank staff using a questionnaire, offering a thorough understanding of the procedure. Statistical analysis, including regression, was applied to determine correlations between employee satisfaction, retention, and productivity, as well as financial performance indicators. The results revealed a statistically significant impact of M&As on employee retention and satisfaction, demonstrating that organizational restructuring influences both financial outcomes and employee well-being. A positive correlation between employee retention, satisfaction, and productivity was identified, suggesting that banks focusing on employee welfare are more likely to see improvements in operational performance. Additionally, regression analysis showed a positive relationship between productivity changes and M&A activities. The study highlights the importance of aligning human resource practices with financial goals during M&As. For policymakers and banking executives, understanding the link between employee satisfaction and financial performance is crucial in navigating M&A events in the banking sector. The study offers valuable insights for scholars and practitioners, emphasizing the critical interaction between human resource factors and financial performance in the context of M&As.