Inarticulate ramblings of a management consultant

the day to day experiences of a consultant operating in weird and wonderful client situations

More evidence of the link between culture and M&A success

Many of you will already be aware of my focus on culture in M&A and it seems that it’s becoming more mainstream to talk about these matters.. Note the recent commentary in the FT on Holcim and Lafarge which tries to downplay the cultural dimensions…perhaps part of the problem is a blind acceptance in the media around business case as opposed to delivery capability!

http://www.ft.com/cms/s/3/d1cc9938-cbec-11e4-beca-00144feab7de.html#axzz3UcoE3fgH

The article below is a good summary of where HR can contribute. A question for us all though is why HR has this responsibility as opposed to other functions. Surely cultural integration impacts on all areas.

http://www.hrmagazine.co.uk/hro/news/1141903/define-culture-avoid-failure-warns-expert

Until we understand clearly the business impact of poor cultural integration and accept it as a key risk which needs to be managed at the earliest possible stage in the deal, we will still be looking at statistics around transactions that are less than attractive for investors.

Categories: Change management, Complex transformation, Functional Leadership, human behaviour, Mergers & acquisitions, Post merger integration, Strategy, Transformation

Tags: , , , , , ,

2 replies

  1. Dear Ben,

    For the post acquistion merger, of two formerly indipendent companies, to fulfill expectations requires commitment. Committment reflects motivation and ambition. If one side doesnt like the new operating style then motivation evaporates and underperformance gains an uper hand as ambition seeks other alternatives. Simples! However the side that sold well, to the acclaim of its shareholders, is not overly concerned; job done. But the acquirer who seeks to retain all that is good from the target really has their work cut out and that is not so simple. A truthful analysis of the differing cultures out to be a pre-requisite to closure. And if the cultural void is massive, then to not do the deal must be better than to squander shareholder funds on a post merger disaster. But it happens. Value identification is the role of the M&A investment bankers. As attachd to human capital, Retention Of Value is not. Nor is Enhancement Of Value. HR? Not your ordinary HR. But a class act working with the CEO co-ordinating specialised external consultancies. Who else?

    All the best,

    Alastair

    Like

    • Hi Alastair, thanks as ever for your comment…agree fully with the concept that we need to understand culture prior to doing deals. However, I have seen widely differing cultures in corporates merge reasonably successfully, as long as there was a willingness for both parts to move! Where the challenge lies is when leadership fails to / or refuses to accept the differences as they stand.

      Like

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