How do you assess whether a target is a good cultural fit in the due diligence process? What kinds of questions can you ask besides “Describe your company culture,” which can easily be answered with slick messaging likely taken from their company website? How do we get at what makes a company really tick on a day-to-day basis?
Hi Emily, great questions – see below some ideas, happy to discuss.
– What are the defining characteristics of your company?
– What differentiates you from other organizations in general?
– What do outsiders not know/realize about this company?
– What aspects of the culture are most important to people here?
– Where in the organization do the dominant subcultures exist?
– What are the company’s negative or undesirable cultural attributes?
You can also have management reply to a questionnaire similar to those that recruiters use to find the true traits about their candidates. These questionnaires would test them against a number of things and would force them to prioritize what truly matters to them. You could also have your own management team do the same and then map them against each other to see where the biggest gaps are. Then you could also make a plan for how to bridge those gaps if the deal goes ahead. HR M&A advisors could help with these kind of questionnaires.