Going through a merger? Compromise is key

During mergers, don’t forget to consider how two corporate cultures will mesh. Save some stress by taking these precautions.

A merger or acquisition between companies is similar to a marriage. When it works, it thrives and flourishes, but when it doesn’t it becomes a nightmare.

Just as a couple has to focus on communication and compromise to keep their marriage strong, merging companies must do the same.

As Tim Donnelly says in a recent Inc. article, “Many of the problems [during a merger] come from the sometimes-awkward mash-up of two distinct corporate cultures—a relationship that experts say is like the first day of high school or a new marriage, because you have no choice but to navigate the unfamiliar situation.”

If executives don’t invest time and effort to ensure a smooth blending of cultures, the merger can end up having a negative impact on the bottom line.

Here are three ways to prevent your next merger from ending in a split:

1. Do your due diligence

Companies typically don’t investigate the differences in corporate culture when beginning a merger or acquisition. Solve this problem by thinking ahead. While the legal team is analyzing the merger, have someone else study the cultural differences between the companies.

2. Don’t try to change everything

Donnelly says, “One mistake companies often make is assuming they need to completely throw out the pre-existing cultures after the merger. In fact, some companies that do it successfully converge on a few shared values, some common operating principles, and standard processes, but leave other aspects as they were.”

3. Communicate expectations

One of the main reasons mergers fail is because employees don’t know what’s expected of them in the new environment. Clearly outline expectations to make the transition smoother. Also, if you have sites outside the main headquarters, make the extra effort to include them.

For more tips, read the full article here.


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