Peter Drucker once famously said that “culture eats strategy for breakfast”. Despite the fact that the assertion is largely accepted, and despite the fact that whenever mergers fail to deliver the expected outcome culture clash is almost always cited as the main factor, precious little is done in M&A processes to assess cultural differences and to address them. In addition to the normal transformation process, a merger situation will require a cultural due-diligence to be performed on both merging organizations, with potential sources of conflict identified. Further more, cultural alignment and projection are a key piece of the integration process, much more than it would be for an established organization.
People can not put energy towards avoiding something, only towards achieving something. Therefore, the most important thing to do in an acquisition is to sell them the new purpose and the new philosophy. More so, the new structures, systems values and leadership styles and competencies, they all need to be aligned in the same direction, to support and deliver the same strategic ambition. The importance if this exercise is often overlooked and the communication itself is mostly done top-down, in a power-oriented manner. This in turn generates resistance, resentment and strong adherence to the past with the consequence of the merging organizations failing to cooperate and dwelling on a past that is suddenly forgiven for all its ills and has all its benefits amplified by a factor of ten. Performance suffers, key people leave, synergies are lost, to the point where people start wondering, two years down the road, “why did we want this in the first place?”.