Ensure that culture isn’t the blind spot that hampers integration success
Why don’t the results of mergers and acquisitions always live up to the expectations?
M&As promise a multitude of strategic benefits including rapid growth, economies of scale and access to new markets, but often deliver varying outcomes. When asked about poor results, most leaders point to an unanticipated misalignment of the two organisations’ cultures.
Understanding and proactively managing culture is critical to successful integration. Investigating cultural compatibility during due diligence enables you to identify what similarities can be leveraged, what differences could cause friction and where the opportunities lie.
An accurate and objective assessment of both companies’ cultures in advance is essential to forecasting the synergies that can be realised in the real world.
According to McKinsey, “95% of executives describe cultural fit as critical to the success of integration, yet 25% cite lack of cultural cohesion as the primary reason that integration efforts fail.”
Source: Organizational cultures in mergers: Addressing the unseen forces, March 26 2019.