Best Ways to Integrate Cultures After a Merger

    3 min read time

    You just completed an acquisition in business, time to celebrate and break out the champagne! Right?

    Well, For some companies, acquiring businesses is their top growth strategy. Unfortunately, for most companies, these acquisitions fail to meet their objectives within the first year, if at all. This can also be one of the most difficult ways to grow your business. That said, failure is not imminent if you do the right things to make the acquisition a success.

    One of these things is to focus on integrating the culture of the new company with the new mother-ship. It sounds easy and straightforward, but integrating cultures is one of the biggest challenges and failure points after an acquisition. It takes so much time and effort to do it right. This is one reason that you should do your best to acquire companies that have good alignment with your core values and beliefs.

    It's also more than going over the financial statements with a fine toothed comb in your due diligence period. People need to be a part of your integration plan, and this means more than just the HR department. You should have an integration team that involves key employees from each department (this builds trust). merger and acq

    After an acquisition, the merger is a difficult undertaking – and often controversial. Employees may feel confused or unsure about what the future holds.

    When there’s a lack of communication, an in-congruent cultural fit, or a poor integration plan, many mergers fail to positively impact the business – not delivering on the expected ROI (which we all know is BAD!) In fact, research has shown that around 70% of M&A;'s fail to deliver their anticipated benefits because of “cultural issues.”

    So let's not neglect how a merger can affect your people! Here are 5 steps to help you integrate the culture of your newly acquired company to avoid chaos and succeed:

    1. One name ---> One company

    This sounds so simple, yet it's a step that is often overlooked. It is VERY difficult to change cultures, so we need to start this on day one. Unifying with the same name helps. The goal is to to eliminate the legacy culture. And whatever name you choose (whether you choose the one with more financial power or not), make sure that it is a unifying force.

    2. Don't disappear

    What do I mean by that? You and your team were most likely VERY visible during the acquisition. Make sure all the key leaders are still present and accessible after the deal is done. Be there to begin shaping the culture and integrating it. Eliminate fears, and answer ALL questions while being as transparent as possible.Tweet: Eliminate fears, and answer questions while being as transparent as possible. #mergers and #acquisitions @RhythmSystems http://bit.ly/2nVHACE One of your top goals is to build trust early on so that your new team is ready to accomplish your 90-day and first-year goals.

    The great thing is you can do this with power of video to connect to other locations. Share when team members are traveling to acquired companies so that new members know when they will have the opportunity communicate with leaders in person on a day to day basis. Just because the purchase agreements have been signed doesn't mean that your job is over! video communication

    3. Don't forget to celebrate holidays and events at the SAME time at ALL locations

    I encourage you to celebrate on a quarterly basis to recognize wins and progress. A year is too long to wait. People need something to look forward to and need positive recognition. Try using quarterly themes to unify people and their efforts to create short-term wins. These informal celebrations also give people a chance to get to know one another better in a relaxed informal setting. 

    Also, include both companies in birthday and holiday celebrations (again using video and newsletters, etc). We have so many technological advancements at our fingertips that there is now reason NOT to include everyone for activities!

    Changing cultures is a difficult thing outside M&A's. So make the extra effort to bring your two companies together so you can successfully impact the world through your people!