Step 6: Develop M&A Culture Integration Plans


You can’t keep everyone happy when it comes to culture change in a merger. So, here’s the deal. Don’t get scattered trying to address all the cultural preference items people make noise about. And don’t tiptoe around the delicate culture issues if they’re crucial and need to be hit head-on. Focus sharply on what’s mission critical.

Ordinarily, only about 5 percent of the cultural issues truly qualify as mission critical. What does that mean? This small handful of traits accounts for about 95 percent of culture’s influence on operating performance. These are the “vital few.” The cultural matters that remain are more or less noise, the “trivial many.” And it’s a mistake for the organization to get distracted by these lightweight issues. Why? Because this remaining 95 percent that’s basically noise will soak up people’s attention, yet account for only 5 percent of culture’s overall impact on business results.

In this section, we provide presentations that explain the facts about cultural integration, assessments that examine cultural differences, and articles that explain M&A culture best practices. Plus, we reveal our insightful research findings on culture in M&A.

Check out our answers to FAQs about Merging Cultures in M&A.

Research

M&A Culture Presentations

Cultural Due Diligence

Cultural Best Practices

Research

Cultural Integration: The "X Factor" in Merger Success and Failure

Cultural Integration: 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 ...

M&A Culture Presentations

Organizational Culture and Mergers: The Hard Facts

Organizational Culture and Mergers: The Hard Facts

Hard Facts About Culture

  • Strategy is a product of your view of the future.
  • Culture is essentially the product of your history
  • That will always present a challenge in ensuring that the corporate culture is aligned with and supports your plans for tomorrow.
  • VERY FEW culture characteristics wield a make-or-break influence over operating results and an organization’s future …
Post-Merger Integration Culture

Post-Merger Integration Culture

Content

Several Ways to Address Cultural Issues
Four Possible Scenarios for Culture Integration
Advantages to Each Approach
Why Are Post-Merger Cultural Issues Difficult to Manage
Consequences of Culture Conflict
Culture Differences Can Cause Integration Failure
3 Important Drivers of Cultural Issues
Components of Culture Change Programs
Cultural Differences in Mergers and Acquisitions

Cultural Differences in Mergers and Acquisitions

The cultural differences between the Acquirer and Acquired Company are identified.

Content

  • Reality
  • How You Described Yourself
  • Cultural Traits
  • Human Resources and Information Technology
  • Acquirer
  • Acquired Company
  • Messages
  • Assessment Summary
     

 

 

Cultural Due Diligence

How to Perform Culture M&A Due Diligence

How to Perform Culture M&A Due Diligence

41-slide PowerPoint presentation on how to perform culture M&A due diligence.

How to Perform Culture M&A Due Diligence: The 5 Stages

  1. Understanding the Deal Logic
  2. Getting Organized
  3. Data Gathering Tools and Techniques
  4. Analyzing the Data
  5. Operationalizing the Data
M&A Culture Assessment

M&A Culture Assessment

Listed below are a number of cultural dimensions and indices that are organized across a continuum.

Step 1: Review each cultural characteristic and place an A in the column that most closely represents your perception of the Acquirer’s culture.
Step 2: Place B in the column that most closely represents the Acquired Company’s current culture.
Step 3: Calculate the absolute difference between each rating to determine the largest culture gaps ...
Cultural Due Diligence Assessment Results

Cultural Due Diligence Interview Results

1. How do people feel about being merged/acquired?

The corporate perspective is different from the field’s perspective. Here at headquarters the questions are, “Is there room at the inn?” and “Will I go to Atlanta?” In the field, people are wondering if they will have to work for less money. Some are angry that it came to this. Did the CEO and the SVP just sell us out? People’s emotions run the gamut from “How could you do this?” to “What took you so long?”

It’s no shock that we merged, but people are set back on their heels that it is this acquirer...
M&A Organizational Culture Checklist

M&A Organizational Culture Checklist

Organizational Culture Checklist covers questions for:

Owners 
Staff 
Customers / Community 
Competitors 
Operations   
What Questions from the Operating Style Analysis Are Particularly Useful?

What Questions from the Operating Style Analysis Are Particularly Useful?

  • "What are the unwritten rules? A lot of things get accomplished in organizations through unwritten rules, side channels and work arounds.
  • What gives a person power here? It gets to the core of what is valued and what makes people successful. Sometimes it is not good behavior.
  • What do people hold sacred about the culture ..."

 

 

Cultural Best Practices

Rx for M&A Culture Integration

Rx for M&A Culture Integration

Nothing in the realm of M&A gets botched up so consistently as the blending of two companies’ corporate cultures ...

 
Don't try to Merge 2 Cultures

Don't Try to Merge Two Cultures by Taking the Best of Each

The “best of both worlds” strategy for integrating cultures brings traumatic destabilization to both organizations ... 
Strategy Culture Disconnection

The Strategy-Culture Disconnection

There's an insidious threat facing organizations that is growing rapidly via M&A:  A loss of alignment between corporate strategy and the existing culture.

If these two fall out of sync, you’ve got a real dilemma on your hands …
Merging Cultures After An Acquisition

Merging Cultures After an Acquisition

Mergers very often are such a destabilizing event, and have such a powerful impact, that they “break the organizational box,” so to speak. Frequently there is a window of opportunity that develops during which management can do some very profound things in terms of reshaping the corporate culture … 
 
When Big Guys Buy Small Fries: The 10 Rules to Follow

When Big Guys Buy Small Fries: The 10 Rules to Follow

The integration of a small, well-run company often requires a light touch strategy. In those situations, follow these 10 rules to achieve the best results: … 
 
Don't Be Surprised When Culture Counterattacks

Don't Be Surprised When Culture Counterattacks

As far as corporate culture is concerned, “change” is the dirtiest word in the dictionary.

It’s culture’s nature to believe deeply in itself, and it shows absolutely no sense of humor when people attempt to redesign it …
 
When It Comes To Culture Change, Standard Communication Procedures Won't Cut It

When It Comes To Culture Change, Standard Communication Procedures Won't Cut It

You need a tremendous amount of high-quality communication to sustain a culture change. Managers typically underestimate the effort that is required. They rely on the normal communication practices and patterns ...
Most Companies Combine Cultural DNA

Most Companies Combine Cultural DNA Without a Strategy

How different a person would you be? If the change happened overnight, would you even recognize yourself the next morning? What would it feel like? How would you behave?

That’s what happens when, for example, a 4,000-person company acquires and integrates a 1,000-person firm ...