Pre-merger culture survey

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    starla Pugh

    I completed by post-merger integration course but did not find much information on actually finding ways through due diligence to help determine the culture & overall happiness/engagement the acquiring business has. I found that a business can mark all the boxes to make a good acquisition, but if the culture is not aligned it can greatly impact the success post-merger. We’re looking for both financially healthy and culturally healthy partnerships. Does anyone have suggestions on tools to use and/or success stories when trying to identify a golden egg from a bad egg?

    Ian Smith

    Hi Starla,
    A lot of the time it comes down to the initial stages of a merger and how this came about. if the merger is hostile there is more than likely to be a culture clash.
    If however it appears the starts are aligned financially and strategically, the socio cultural element is usually a gut feel between leadership. one tool I have seen in the past is a third party test done for both the buyer and seller that assesses the culture of each business and makes simple checks such as appetite for change, social priorities, working culture (e.g. office or home working preference, term time requirements etc) this allows an understanding on how aligned the two groups are at least.
    But it can depend on the merger itself – e.g. hostile / competitor / client in sourcing and looks down on the newly acquired entity still as a supplier etc.


    See there are tools for culture assessment but pre merger how can you use those is a questions. For example Mckinsey’s OHI (Organization Health Index is one tool) which is very good tool and I have personally used but pre-merger you cant do any survey. Therefore some third part agency needs to be mandated and then they can recruit some x employees, current employees, suppliers, dealers, other partners for some surveys. that is the only way to know about the inherent culture of the organization. Basis that then acquiring company can decide about this.

    Emily Reinhart

    I have seen the data of an annual employee survey around culture and employee engagement compared to the transitioned population and overall company scores post-close. Like folks referenced in previous replies, if you are not engaged as a consultant or business leader to do a survey ahead of the transaction, that limits the comparison data. That’s why I always advise company leadership to initiate an annual employee engagement survey regardless of where they are in the acquisition cycle.

    Ebrima B Sawaneh

    I think the pre-merger survey of employee opinion is important. However, culture can be assessed partly from the HR policies example policies on benefits, L&D, promotions etc. The outcome of the survey and HR policies of the target should be compared with the acquirer. Where there is a major conflict, the pre-merger integration plan should offer a solution. You may recall the major merger failure of Air India and Indian airline was partly a major difference in the compensations.

    Raymond Teo

    Agreed with Ebrima. If the HR policies and culture of an target company is not able to fitted into the acquiring company, this might resulted in a bad merger. I believe other form of DD, understanding of the target company’s culture will be much more important that relying on Employee’s survey. As employees might not take the survey seriously based on my experience.

    Trevor Szutu

    Well designed culture surveys pre-merger provide a lot of valuable insights heading into integration planning. However, poorly designed questions and low response rates pose a challenge

    Nora Sophia Martin

    I think it’s important to offer surveys for leaders and employees separate as the commitment and impact of leaders is extremely important for the success of the integration. Also, a change impact assessment could be helpful to get a clear picture how the day-to-day business works currently and how it would look like after the merger. The goal would be to identify potentially cultural differences and changes based on changing processes, technology etc.

    S Sarala Maharaj

    I agree that the importance of reviewing HR policies and employee surveys ( historic) are critical to understanding the culture of an organisation. In some of my acquisitions we have used management meetings during diligence to probe for those answers which you may not find in the written policy or report.

    Geraldine Finn

    I always found an HR focused interview with CEO/senior leadership of target to be a good early insight and indicator of cultural fit/misalignment. Beyond the discussion of engagement scores, we delved into how decisions were made, how feedback is given is received and received and how disciplinary issues are handled in real time.

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