What is company culture and why does it matter if the old and new are not aligned?
There are rules for all the legal bits of a merger or acquisition process, yet there is no bible or handy instruction manual for the successful transfer or integration of company culture.
This is a precis of our November 2021 Blog Post. You can read more on our website: https://www.thesparkcompany.uk/blog/mergers-and-acquisitions-how-to-spot-and-avoid-culture-clashes
What is workplace culture?
Workplace culture is your way of doing things, your approach and style of business. It’s often tricky to explain but culture manifests itself through leadership style, how you treat your customers and colleagues, and the diversity of your workforce.
How can culture impact M&A?
An unforeseen culture clash creates an uncomfortable, disengaged work force. If people don’t understand the values and objectives of the newly merged business they will quickly retreat into the familiarity of the old. This can slow down the integration of departments and operational systems.
Everyone’s talking about the great resignation at the moment, so it’s more important then ever before to have a plan for engagement, talent and culture. Especially if your acquiring a business or merging two organisations together.
How can I assess the culture of my acquisition?
It might be tricky to really get under the bonnet of your acquisition in advance of the legal transfer date. Certain information around TUPE, finances, compliance and commercial integration, are accessible. But when it comes to engagement and culture, you’re not going to be able to hover around the water cooler or join a team meeting to gather intel!
If you’re using an independent HR consultant to help you navigate the legal aspects of your merger or acquisition this can also be a great way to assess potential pain points and plan for the challenges ahead.
Why does culture matter?
Clearly defined culture is a sign of a positive, engaged workforce, which means exceptional customer service, confident sales and marketing, increased productivity, and reduced staff turnover.
“Studies from the Queens School of Business and the Gallup Organization showed that organizations with low employee engagement scores experienced 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price over time.” (Harvard Business Review)
Do leaders know how to promote positive culture?
If people are used to being managed in a certain way it can be deeply unsettling when a new regime comes along. One of the best ways to establish your organisation’s culture and ethos early on, is for management to get out on the shop floor and talk to people.
A Welcome Meeting is a 'must do' when it comes to mergers and acquisitions. As well giving people practical, operational information about how the business will look in the future it’s a great opportunity to gain insight into how people are feeling about the change.
How can I take people with me?
If your organisation is office-based and you’re acquiring a business that works out in the field, how will you make those people feel welcome and avoid a two-tier workforce? Your ways of working and communicating historically may not suit your new colleagues. Sending an internal newsletter once a week via email is no good if half the business don’t sit at a desk (or have a smartphone).
Blog submitted by https://www.thesparkcompany.uk/home