Corporate Culture: The "X Factor" in Merger Success and Failure

Organizations have grown far more sophisticated and skilled in their ability to execute the integration process. The one area where companies still struggle, though, is in merging disparate cultures. This is the black box of integration, the most complex problem that executives encounter in M&A.

PRITCHETT, LP surveyed 130 executives and their responses offer important clues for cracking the code on culture in M&A. Here’s what the data indicates:

  • Most culture assessment efforts are too ad hoc, unstructured, sketchy, and haphazard. In fact, they may very well cause more problems than they solve. There is a clear lack of efficacy in the data-gathering process and how that information is utilized.
  • Outside consultants have utterly failed at establishing credibility in this arena. Executives have apparently concluded that the purveyors of traditional culture assessment/culture integration services don’t add value ...