Reply To: The Culture Factor in M&As

#110108

Beckie Callahan
Participant

My guess is that C-level executives are overly optimistic in the role that culture fit plays in M&A (or they are not reading the research). Perhaps in many cases, the acquiring company is only after specific technologies and/or patents, the culture of the non-key employees are not relevant. I just reviewed a list of 76 companies that my employer has acquired over the past 10 years that I’ve been working. I was surprised to remember some of the cases and how certain executives were very bullish on specific product lines, but if they left, then those acquisitions or product lines may have been abandoned as well. Sometimes the short-term goals get forgotten when the next shiny object or hot new trend appears. The definition of success to an outsider may be different than to the company insiders. Another consideration is the wide-spread use of videoconferencing now with the COVID-19 situation. As people are not travelling, C-level executives are now able to join more calls and be involved in ways that were more difficult before. Better communication, expectations setting and sharing may improve cultural issues. Who knows, now I’m the one being the optimist! 🙂

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