In M&A, make the integration of at least two cultures a top priority

by | 2 Feb 2023 | M&A integration

Most organisations comprise a corporate culture and many sub-cultures, often at a function, service, or geographic level, sometimes even down to a team level.

When you assume you are bringing together two cultures, it’s often significantly more than that in a merger. You often bring together people with very different values, behaviours, leadership styles, mindsets, and policies. The integration challenge is winning the hearts and minds of all employees and giving them a compelling vision to buy into.

So how do you integrate multiple cultures together?

  • Diagnose current cultures, including subcultures, to understand the baseline you are working from. Then define the future end-state culture. Even if you are adopting the buyer’s culture, find one or two cultural characteristics from the organisation you are acquiring.
  • Be clear and consistent on the intent. In my experience, the worst thing executives can do is talk about a ‘merger’ or ‘merger of equals’ but act ‘acquisition’ or worse ‘, takeover’. Language can create false expectations, and when language and behaviour are incongruent, it quickly breaks trust or prevents it from being established in the first place.
  • Settle leadership roles quickly to identify who can then help stabilise the rest of the organisation is an important step. It might also provide the opportunity to make changes in the leadership that aren’t necessarily related to the deal. In a context where change is already expected, there are opportunities to look at teams and departments that might be underperforming or could use a shakeup and position the move as part of the broader integration process.
  • Invest time in building great relationships with the organisation being acquired. This can pay dividends later on and will ensure the transition is seamless. Too often, leadership teams turn inwards, let their ego dominate and fail to build relationships with their new colleagues.
  • Get day one right. The first significant milestone of any merger or acquisition is ‘day one’ and having a clear blueprint for how you will operate that everyone buys into. Getting ‘day one right is essential in creating momentum and credibility in the organisation, so it’s not worth investing time and energy in.
  •  Find symbols of change to introduce new ways of working that can help smooth the integration process. To support the implementation and adoption of the integration plan, it’s essential to ensure that the integration is at the forefront of colleagues’ minds through visible acts of change.
  • Manage those who seek to dominate. When executives cannot keep their egos in check, my advice would be to reassign these people to positions away from the integration action.

Based in London and with over 24 years’ global experience, Karen Thomas-Bland is often cited as one of the top business transformation consultants and coaches in the world. She is a trusted advisor to boards, executive teams and investors, creating sustainable, long-term value for FTSE/Fortune businesses and PE funds. She writes for many publications including The Times, FT, Association of MBAs and Management Today.