Strategic Investment Appraisal: Multidisciplinary Perspectives

Mergers and acquisitions (M&A) are arguably one of the CEOs greatest challenges, and there is a critical need to get these decisions right. It is clear that no single theory is adequate to describe or inform how M&A are evaluated in uncertain conditions, but there are several that offer partial explanations or at least contribute toward our understanding of how managers can deal with the uncertain environment and assess the likely risks associated with M&A. The literature suggests how relevant theories might be aggregated to make sense of strategic investment decision and investment appraisal techniques in an organizational context and considers the implications for further research in this important area of M&A. This chapter focuses on strategic investment appraisal, and draws together a variety of theoretical perspectives, especially from the field of psychology, which may be unfamiliar to both scholars in and practitioners.