The Relationship between Operational Synergy and Firm Performance: A Review of Literature

Q3 Economics, Econometrics and Finance

Afro-Asian Journal of Finance and Accounting Pub Date : 2023-08-16 DOI:10.53819/81018102t4184

Sammy Machoka Oira

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引用次数: 0

Abstract

Theoretical and empirical evidence has documented erratic and fluctuating firm performance amongst financial firms worldwide and across different economic sectors. The need to stabilize firm performance has instigated a variety of corporate reorganization strategies including Mergers and Acquisitions. However, theoretical and empirical literature has not been quite categorical on the link between operational synergies (arising from Mergers and Acquisitions) and firm performance. Firms have increasingly inclined towards operational synergy to enhance firm performance. Operational synergy has consistently improved firm performance outcomes in most firms. However, while numerous studies have examined the relationship between operational synergy and performance, there exists a need to synthesize and consolidate the findings across diverse contexts and economic sectors. Hence, the purpose of this review was to determine the relationship between operational synergy and firm performance via desktop review. The study was informed by three theories; The Theory of Misvaluation, The Hubris Theory and Stakeholder Theory. The review adopted a positivist research philosophy and desktop review design via evidence-based approach. The Study Documents that operational synergy has a significant effect on firm performance. Additionally, the review finds that firms which actively pursue operational synergy strategies exhibit improved financial performance, cost reduction, streamlined processes, and higher customer satisfaction. The study further finds that firms which successfully achieve operational synergy, particularly through mergers and acquisitions, have a tendency to outperform their competitors financially, with improved profitability, cost efficiency, and overall financial performance. Hence, the study recommends that firms should prioritize the development and implementation of strategies that foster operational synergy such as promoting a culture of collaboration, communication, and integration across different operational functions. Keywords: Operational synergy, Organizational effectiveness, Integration, Efficiency, Review of literature, Performance

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经营协同与企业绩效的关系:文献综述

理论和经验证据证明，世界各地和不同经济部门的金融公司的业绩不稳定和波动。稳定企业业绩的需要催生了包括兼并和收购在内的各种企业重组战略。然而，理论和实证文献并没有非常明确地说明运营协同效应(源于并购)与企业绩效之间的联系。企业越来越倾向于业务协同，以提高企业绩效。在大多数企业中，运营协同效应持续改善了企业绩效结果。然而，虽然有许多研究审查了业务协同作用与绩效之间的关系，但仍有必要综合和巩固不同背景和经济部门的研究结果。因此，本综述的目的是通过桌面综述来确定运营协同与企业绩效之间的关系。这项研究有三个理论依据;错误估价理论、傲慢理论和利益相关者理论。本综述采用实证主义的研究理念和基于证据的桌面综述设计。研究表明，经营协同效应对企业绩效有显著影响。此外，研究发现，积极追求运营协同战略的公司表现出更好的财务绩效、成本降低、流程简化和更高的客户满意度。研究进一步发现，成功实现运营协同的公司，特别是通过并购，在财务上有超越竞争对手的趋势，盈利能力、成本效率和整体财务绩效都有所提高。因此，该研究建议企业应优先制定和实施促进运营协同的战略，如促进跨不同运营职能的协作、沟通和整合文化。关键词:运营协同、组织效能、整合、效率、文献综述、绩效

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来源期刊

Afro-Asian Journal of Finance and Accounting Economics, Econometrics and Finance-Finance

CiteScore

0.70

自引率

0.00%

发文量

期刊介绍： Finance and accounting are seen as essential components for the successful implementation of market-based development policies supporting economic liberalisation in the rapidly emerging economies in Africa, the Middle-East and Asia. AAJFA aims to foster greater discussion and research of the development of the finance and accounting disciplines in these regions. A major feature of the journal will be to emphasise the implications of this development and the effects on businesses, academics and professionals. Topics covered include: -Asset pricing, corporate finance, banking; market microstructure -Behavioural and experimental finance; law and finance -Emerging economies: finance, audit committees, corporate governance -Islamic finance, accounting and auditing -Equity analysis and valuation, venture capital and IPOs -National GAAP and IASs compliance, harmonisation and strategies -Financial measurement/disclosure, and the quality of information reported -Accountability and social/ethical/environmental measurement/reporting -Cultural, political, institutional impact on financial measurement/disclosure -Accounting practices for intellectual capital and other intangible assets -Provision of non-audit services and impairment to auditor independence -Audit quality and auditor skills; internal control/auditing -Management accounting, control and /use of key performance indicators -Accounting education and professional development, accounting history -Public sector and not-for-profit accounting