Playing Politics: An Upper Echelons Perspective on Political Behaviour During Acquisition Decision Making

The pre‐deal phase of an acquisition is complex, with high stakes and high uncertainty. Consequently, acquisition decision making can be seen as an inherently political process. While political behaviour is a central concept in organizational theory, and despite its inevitability during acquisition decision making owing to the contested nature of the pre‐deal phase, there is a shortage of theory and evidence concerning the antecedents, consequences and moderators of political behaviour. To address these theoretical shortcomings, we develop and test a theoretical model of political behaviour focusing on the psychological context of the top management team (TMT). We argue that while political behaviour risks undermining acquisition performance, the degree of board involvement during the pre‐deal phase can enable some TMTs to attenuate the damaging effects of political behaviour. Further, we theorize two key antecedents variously fuelling and constraining political behaviour. We contend that while TMT cohesion reduces political behaviour, cognitive diversity increases political behaviour while suppressing the potential for TMT cohesion to prevent political behaviour. We test our theoretical model using a field‐based sample of 109 UK acquisitions, combining multiple informants with objective secondary data.