Cultural Differences in Mergers and Acquisitions

A company’s culture is basically a company’s identity. It affects every aspect of employee performance. It encompasses how employees interact with each other and management, how vacation days are handled, employee morale, diversity ratios, how people are disciplined and/or promoted, how off-site social events are organized, and ultimately the rate of turnover, profit margins, and client satisfaction. When a business is taken over by another business, aside from the fear of termination, the looming change in corporate culture is what weighs most heavily on the minds of team members. In today’s society of mindfulness and awareness, complimentary cultures and gentle transitions are more important than ever when it comes to assimilating an organization.

A good company culture inspires creativity and collaboration, thereby also fostering productivity. The merged company will benefit in the long run by taking the target company’s culture into account and doing their research before the acquisition. If changes are to be made, they should be well-communicated with all team members and introduced gradually instead of all at once, so as not to be too jarring. A level of sensitivity is needed whenever a takeover occurs.

Ideally, when two companies merge, they should each bring a little of their own culture to the table, thereby creating an expansive super culture that combines the best of both worlds. While it may seem impossible to keep everyone happy and at ease, there are ways of blending methodologies that will encourage a sense of camaraderie and teamwork among new peer groups.