Overview:
During a significant change like a merger or acquisition, listening, architecting and integrating both cultures is critical for maximizing the value of the deal. Organizations that thrive in today's complex business environment benefit from dynamic, robust cultures.
It's common knowledge that mergers often fail or fall short of realizing expected value due to complications during cultural integration. When surveyed, many CEOs reported that they had no plan in place for integration and even if they did, they wished in hindsight that they'd had devoted more time and resources to cultural integration.
Why do we continue to perpetuate a problem we can solve? Bain Consulting reported that based on the survey data and anecdotal conversations with CEOs, executive leaders often don't know what to do when they need address cultural integration. Cultural integration and cultural change are deemed "fuzzy" right brain areas that most action oriented, results driven CEOs were challenged to address.
Yet successfully integrating the cultures of two different companies matters because culture is a significant organizational driver, both positively and negatively. What's hardest to see, quantify or examine often holds the most power in an organization. Culture can encompass how companies communicate, how people and teams relate, how conflict is handled, organizational beliefs, mindsets, emotions, and how events are interpreted – all of which influence how problems are solved and decisions are made.
On the quantitative side, 83% of mergers fail and 50% of leaders are terminated when these change initiatives fail to produce value. In fact, a 2011 global survey conducted by Aon Hewitt uncovered that unsuccessful cultural integration was the number two driver of deal failure. The number one driver of deal failure was "integration/implementation took longer than expected" which in and of itself is adversely impacted by unsuccessful cultural integration.
Without successful integration, likely outcomes include: mediocre, at best, decisions, problems solved with band aide solutions, and the exit of good talent. And the bottom line value of the deal is adversely impacted.
When faced with a "right brain" issue, such as culture, companies often try to create a linear "left brain" process to make addressing the issue. Here's the problem with that: It doesn't typically work in implementation or it doesn't work thoroughly enough over the long term. Ideally any problem would be solved using both our linear, analytical left brain and our creative, intuitive right brain. Cultural integration is no different. Because culture is often rooted in the unspoken, the believed, the unintentional and the symbolic, it deserves plenty of right brain creative attention.
During the webinar, we'll discuss a five step Cultural Integration Design process that helps two different companies come together to form a culture that works together well. By executing this five step process, executive leaders retain and increase the value of their business during a merger or acquisition. The method includes these five steps: Cultural Intelligence Assessment, Cultural Profile, Cultural Architecture, Design & Prototype, and Integrate & Train.
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