Anyone who has spent any time managing a post acquisition integration will recognise that culture is a, and in many cases, the critical factor which can determine success or failure. This is not something new…and yet it still comes as a surprise for many acquirers.
Despite this widespread knowledge, much confusion still reigns around what cultural dimensions to consider, how to find them and measure them, and then most importantly, what on earth to do about them.
This week I want to deal with some important misconceptions…hopefully they align with some of your experience:
- The post announcement dinner between the CEOs of two integrating businesses where they talk about the positive qualities of their respective organisations, the extremely high level development of a joint strategy and in general ‘get on’, does not, in itself, constitute a cultural assessment! Too often, these types of meetings are broadcast as the two integrating entities being similar or working on a similar set of values.In fact, the misinformation arising from this type of messaging has, in my experience, done incredible damage as the employees find in fact, that there are considerable differences between the two organisations. It erodes trust and often leads to a conclusion that leadership is incompetent at best or being deliberately misleading at worst.
- Contrary to opinion, integrating companies with two very different cultures is not necessarily more difficult that integrating two similar ones. One of the things that I’ve observed in cross border acquisitions where you’re often dealing with different national as well as corporate cultures is that the heightened sense of awareness on both sides of the deal leads to better listening and ultimately a position where both organisations recognise the need to change. This creates momentum and that in turn generates activity and responsiveness…two key elements.
- The values and mission statement of most organisations that I’ve ever come across are not a good guide for the inherent culture. To test this, find a random employee…place them in front of the values (that are no doubt etched into a wall somewhere at enormous expense!) and ask them whether they recognise them in the behaviour of their boss. Understandably perhaps, values and mission statements tend to be aspirational rather than grounded in the reality of the culture today.
- Whilst you may be extremely familiar with the concept of corporate culture, the vast majority of employees are not. Asking them to describe their culture is therefore a pointless task…for two reasons:
- It leads to vague, high level language which will give you no insight into what’s really happening there, or:
- You will hear a long explanation of how wonderful the place is, often referring back to some bygone and probably largely mythical era
- The leadership of a business is not an accurate proxy for its culture. Just talking to the leaders will not give you proper insight into the organisation…and most importantly, will result in you missing the best engagement opportunity you’re likely to have in the early days of an integration.
- Listening to those who make the most noise is a strategy which will mean that you miss 60-80% of the population. Acolytes and terrorists occupy the two extremes of any employee landscape…the silent majority are as, if not more, important and you need to understand their experience proportionately in any cultural assessment process.
- Doing an electronic survey with employees from a recently acquired business, who didn’t ask / volunteer to work for you, may be an easy exercise to deliver. It is, however highly unlikely to give you any valuable insight….other than the fact that they are extremely unhappy and are using this as an exercise to vent their spleen! A challenge for you:
- Ask 20 people in your organisation to write down the names of the 10 most influential people in the company (note the term influential…not most senior, experienced, scary!)
- Compare lists and you will see a remarkable level of consistency.
- Interview those about culture in a smart way (ie don’t ask about culture directly) and you will have an accurate proxy.
Next week some ideas on a couple of key cultural dimensions to consider.