Acquisitions Will Succeed When Companies Center People, Not Profit
Company leaders mindfully craft their organization’s mission and vision statements. They carefully select the language they use to define their company’s purpose to the world, and they build a collection of values for their team members to study and embody. However, when a company’s culture is described, no one references a corporate statement or adheres to a script. Rather, they are telling what they see taking place in the environment daily.
While it cannot be prescribed itself, company culture is all those things – vision, mission, core values – playing out organically on an interpersonal level between employees. In a sense, the culture of a company reflects how well leadership has embraced their values and translated their words into action.
The impact of work culture is undeniable. During times of stability, work culture is the primary indicator of employee satisfaction and retention. In times of significant change, like an acquisition, company culture has the capacity to hold teams together through massive transitions. Failure to prioritize support for a company’s most valuable asset, its people, spells ruin for the acquisition and both companies involved.
There is a tendency to focus almost exclusively on the external impacts of acquisitions rather than internal, but this is a mistake. Employees and, by extension, work culture should be a top priority from the beginning. Leaders must start learning the culture of all parties involved on day one to develop effective transitionary support plans.
Transparency Even in Uncertainty
For employees, the term “acquisition” likely triggers alarm. The merging of two organizations can be an uncertain process of upheaval and resettlement. Proactive, transparent communication builds trust among team members who have valid concerns about their place or permanence within this new joint endeavor.
Employees will have questions at every stage in the process, and it’s okay – expected, really – for leaders to not have every single answer in the moment. A transparent, “I don’t know,” garners more trust and respect than any well-rehearsed non-response. With leaders fostering trust through transparent communication throughout both companies, a foundation of trust between the two teams can begin to be built.
Don’t Shy Away from Differences
Many acquisition announcements include statements about how aligned the companies are to lend credibility and foster confidence in the union. This is understandable and fitting for public-facing press. However, business leaders should not be tempted to identify similarities where they do not exist during the acquisition process.
Every single company has a unique culture. Blindly equating one with another is dismissive of the team who built it. Beyond that, intentionally identifying differences between two cultures is an effective way to identify potential pressure points and set aside resources to proactively resolve those to avoid damaging and time-consuming conflicts down the road.
Keep What Works; Grow Better Together
An exciting, though somewhat contentious, aspect of building a shared work culture is selecting each company’s “best” attributes to carry forward in the merger. The goal is to achieve harmony with a new culture that preserves and combines parts of each company that are proven to be successful. Typically, these are areas of focus with the most significant business impact.
Building Culture Globally
Acquisitions across global entities are gaining prevalence and present unique challenges. Of course, there are barriers like physical distance and time zone differences that complicate day-to-day interactions, but a corporate culture with the flexibility to navigate business during a global pandemic has little issue implementing creative logistics. In contrast, navigating differences across corporate and local cultures presents more layered complications requiring nuanced solutions. Local cultures are deeply, sometimes unconsciously, held. From social cues to nonverbal communication to work-life balance, local culture profoundly impacts every facet of company culture.
A pitfall some companies experience during acquisitions involves leadership or management’s attempts to manufacture a corporate culture of their choosing artificially. This is antithetical to the nature of culture. It is a product of leadership, mission and values – not a list of qualities open for an individual to manipulate.
Successful acquisitions hinge on people – how happy they are, how fulfilling they find their role, how much trust they have in leadership – the list goes on. To positively impact company culture, set the tone through leadership, training and ongoing dialogue, and leave space for corporate culture to develop organically and interpersonally.