Merging Cultures Article Overview

A primary cause for failing mergers is inattention from the leadership team as to how employees are responding to the enormous change that occurs during integration.

What Will this Article do for Me?

Dr. Mary Kay had two reasons for conducting this research on merging cultures:

  • First, to identify the specific factors that senior leaders may implement at the time of the merger to help predict merger success.
  • Second, to determine what leadership behaviors contribute to merger success and prevent unproductive reactions in employees that limit an organization’s strategy from being achieved.

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What Causes Cultures to Clash?

The main cause of culture clash is when organizations merge they are often successful organizations that have strong or powerful cultures. This is similar to having two strong-willed people working together during an immense time of change. A natural conflict will occur as both people, or cultures, in this case, lack the flexibility to adapt to ongoing change.

A strong culture has two attributes: 1) a united team of employees that operate within the values of their organization, and 2) a high level of commitment as to how these values align with organizational success.

This finding is a consideration as to why strong cultures in two organizations may not be a positive indicator when planning to merge. Cartwright & Cooper (1993) believe this to be true as they liken mergers to “organizational marriages where particularly strong cultures are not meant to change.”

 Why are Senior Leaders Inattentive?

Research indicates there is a gap between what senior leaders deem to be important during the merger and what the employees believe to be important.

The leaders in charge of the merger view integration as more strategic than non-managerial employees. The senior management team focuses on the organizational structure, getting resources in place, and merger costs.

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Employees feel the priorities during integration need not be designed around strategies of structure but for senior leaders to focus more on the soft side of the merger. Employees want and need higher levels of communication during times of change. Dr. Whitaker’s research confirms the factors most desired by employees are building trust and motivation compared to all other factors needed during the transition phase.

This suggests that while senior leadership teams believe they are providing direction or managing the merger, perhaps they are causing the culture clash by not developing a cultural fit in the employee-employer relationship and between the two, unique cultures.

Minimizing Post-Merger Drift

Dr. Whitaker’s research indicates that by emphasizing “the people side” of the business as a key strategy within the first three months of integration reduces the time spent on cultures clashing and people drifting apart.

Organizations that have a higher rate of post-merger drift are those organizations that neglected to include “the people” strategy. A people strategy is as important as a strategic one. Daniel (2001) defines this people approach as having a clear understanding of “value drivers.” Value drivers are the 20% of the actions that “drive 80% of the value. Dr. Whitaker’s research reveals the top value drivers for merger success.

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Ron Whitaker
Ron is an accomplished entrepreneur involved in developing multiple businesses from the ground up. He is the co-founder of About Leaders, an author, and a start up consultant and investor. Follow him on Twitter and Facebook.

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