Cultural Clashes within Organizations

This topic contains 3 replies, has 4 voices, and was last updated by  Brandon Kissinger 2 days, 13 hours ago.

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  • #112924

    Matthew Chatelain
    Participant

    Would be curious to understand other M&A experiences, where employees of one organization felt severe culture shock upon merger with another organization. We have witnessed situations where acquisitions did not go according to plan as a result of different decision-making styles, leadership hierarchies, and change management approaches. However, has anyone experienced a situation where cultural integration was initially questionable, but eventually, the integration was deemed successful from a human capital perspective, and if so, what techniques were implemented to get to that point?

    #113984

    Awais Dilawer
    Participant

    Being Culturally Fit is the foremost requirement for the organization for making the decision to acquire a firm. Culture differences turns out to be a disaster and source of big loss for the companies

    #114576

    Clark Murphy
    Participant

    Absolutely Awais. It should be the first requirement of any acquisition opportunity. If there is a culture clash, then the transaction will most likely cost a lot of money to the acquiring company and would provide no value. That being said, if the transaction is only IP based, then that might not be a requirement. However, the seller might not want to sell the company to the potential acquirer if that were the case.

    #115035

    Brandon Kissinger
    Participant

    What seems to be the most difficult is assessing potential cultural clashes. While firms like Vista Equity Partners require all employees to take a competency test, this seems to be done after the acquisition is completed. Along these same lines, I can imagine that you could only interview the most senior leaders (small sample size) to gauge the cultural fit of an acquisition.

    Are there steps one can take to get a feel for say 70% of the organization prior to an acquisition?

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