The Impact of Emotional Memories, Goals, and Psychological Capital on Performance During M&A Organizational Change

Abstract In this chapter, we address the widely reported underperformance of Mergers and Acquisitions (M&A), often linked to “merger syndrome,” in which individuals face behavioral and performance challenges. Despite its prevalence, the mechanisms driving these within-person changes remain poorly understood. Adopting a managerial and organizational cognition perspective, we examine how goals, emotions, self-regulation, psychological capital (PsyCap), and emotional memories interact to shape individual behavior during organizational change. Drawing on over 20 interviews across a financial services firm that underwent two consecutive mergers, from senior leadership to frontline staff, we explore how people recall the merger experience and how those memories shape their outlook. Our analysis focuses on shifts in self-regulatory (SR) processes during the transition. We propose that behavioral and performance variations stem from increased affective-cognitive load that depletes self-regulatory resources (SRR). Factors such as shifting goals and PsyCap (hope, self-efficacy, optimism, and resilience) influence SRR depletion and use while autobiographical emotional memories (AEMs) further shape goal orientation and PsyCap. We present a process model linking these elements, supported by initial qualitative evidence. Based on this model, we suggest managerial interventions aimed at positively shaping AEMs, reducing resource depletion, and enhancing PsyCap. By targeting these within-person dynamics, organizations can better support employees and increase the likelihood of successful post-merger integration (PMI).