ET CITINGS

By Rebecca Doherty Et Al

The skills and capabilities that companies need to improve most when they integrate are persistent and, for many, familiar. Grounding an integration in the objectives of the deal, bringing together disparate cultures, setting the right performance goals and attracting the best talent are among the top challenges that bedevil acquirers. They’re also the ones that differentiate strong performers from weaker ones.

Companies often struggle to assess and manage culture and organisational compatibility because managers focus on the wrong things. Too often, they revert to rites, rituals, language, norms and artifacts —addressing the most visible expressions of culture than the underlying management practices and working norms.

Managers often return from initial deal interactions convinced that the cultures of the companies involved are similar and will be easy to combine. As a result, they almost always apply too few resources to the cultural side of the integration, often leaving it to human resources to lead.

For cultural integration to be successful, employees must view it as core to the business. That may not happen if business leaders are not visibly leading and prioritising the cultural integration. Culture is difficult to address because it permeates an organisation — spanning levels, geographies and organisations.

From “How the best acquirers excel at integration”