M&A Cultural Alignment: A Unified Culture Means a Strong Brand
When companies participate in M&A activity, they understand that there will be challenges associated with combining two unique businesses into a single entity. How customers will react to the combined business is a big concern. Managing customer expectations, ensuring that the company’s external brand is shifted smoothly and value remains high all need to be addressed in the external rebrand.
However, this does not tell the whole story, as it does not address the need for clear, internal communication and an effort to merge the cultures of each company so that all parties are on the same track, moving toward the same purpose. In many ways, a company’s culture is its brand, and if the employee experience and attitudes vary throughout the company, the customer experience will begin to reflect that.
Before companies close on a deal, they should be conducting research into each other’s culture and behaviors to determine how well they will integrate.
Are employees given a reason, beyond revenue, for the impact of their work? If so, do the broader purposes of the two companies align?
Think about what’s driving employee success. Do employees seem to be largely autonomous, responding to an internal drive toward mastery? Is there a social pressure from peers to succeed? Or, is the primary motivation a program of monetary incentives?
Do employees deliver better when interacting in a collaborative or competitive environment? Is there a strict hierarchy of management, or is the structure more fluid?
Would the company’s behaviors be described as risk-taking or conservative? Are projects process-driven and heavily documented at all levels or focused solely on outcomes and final results?
Determine where the differences between the companies lie and be clear about where they will or will not integrate smoothly. As the plan for how departments will be merged or hierarchically arranged develops, be sure to consider how the employees in each have been managed, and whether they will be forced to adapt to a radically different environment. Brainstorm ways to bridge the gaps when necessary.
If there is a clear plan from the beginning that both companies can be confident in, and it is communicated well as the companies integrate, both companies will benefit from improved internal morale, increased loyalty and unified purpose.