Ask the Expert: Cultural Alignment is Critical during Mergers & Acquisitions

A strong, positive culture is a critical part of a successful business — and an even more critical part of successfully combining companies through an acquisition or merger. Jackie Dryden, Savage’s Creative Strategist, talks about the role culture plays when combining organizations.

When merging companies, how do you make cultural alignment a key goal when process integration is so often the focus?

Ultimately, a merger is not just about financial factors ‰- new geographic footholds, new capabilities, new growth, and new products. It‰’s also about the new culture being created, and it‰’s imperative to place as much attention here as on the financial numbers to get employees on board with the change.

How can companies get employees excited about a financial merger or acquisition? By helping them understand how the new combined organization will be better for all stakeholders, not just a few. It‰’s about providing each employee solid reasons for believing in a larger purpose.

 

What part does culture play in a merger or acquisition?

It‰’s critical. It‰’s beyond critical. Culture is one of the most powerful components in determining the success or facilitating the failure of an acquisition or merger. It‰’s a delicate dance to bring together divergent groups with different styles, procedures and belief systems. Companies must give their employees compelling reasons to rally their individual strengths in support of a single unified purpose.

To make the merging of different cultures successful, employees must be engaged at their belief level. The questions of ‰”Why should I want to be a part of this merger?‰” and ‰”What‰’s in it for me?‰” have to be answered.

In any combining of cultures, people on both sides are worried about themselves and their jobs. When a company is able to show employees how they can make an impact on the emerging culture and how to become positive influencers, the entire experience is more successful and less stressful for all involved.

 

What suggestions would you make for companies looking to merge two different cultures?

First, before anything else, companies must do the work of understanding their own ‰”Why?‰” and how that leads to a strong mission, vision and values. If that‰’s not understood and defined, the leadership cannot know how to go about combining their purpose with another company‰’s purpose.

Second, determine a strategy for how to communicate and build alignment with the merged purpose internally, and then how to share that story externally. A critical piece for building a solid internal culture is recognizing who the influencers are within a company and making sure they become the front line ambassadors for the new emerging culture. These people may not always be identified by job titles or hierarchy ‰- they can be anywhere within the company. It is important to identify and enlist these influencers very early in the process.

Most of all, stay the course. Don‰’t get cold feet and back off the new culture-building plan. Don‰’t be too eager to dive in to the tactics and execution that the culture does not have a chance to take hold and permeate the entire company.