Cooking Up Culture: Blending Mergers, Acquisitions and Motivation

Rob Danna
Rob Danna

Chef whipping up ingredients in a bowl

Kids are innately creative, but they usually don’t have the real-world experience to know exactly how their creative ideas will pan out. Case in point: kitchen experiments.

Chocolate syrup tastes really good, and so does ketchup, so if they’re combined, you’ll get something that tastes even better, right?

One taste and the answer is clear: Yuck.

As businesses grow, they look for ways to make themselves larger. Often—and increasingly more so in recent years—this involves a merger or acquisition. Global mergers and acquisitions reached an all-time high of $4.304 trillion in 2015, beating an earlier record of $4.296 trillion in 2007.

Just like chocolate and ketchup, combining two great things can end up as one bad thing.

If businesses do not understand the merger’s effect on employee motivation, their efforts could fall flat or result in irreparable damage, leaving a miserable taste in everyone’s mouth.

Staff meeting about merger or acquisition

Maslow and Mergers

There’s one variable that’s often overlooked in the C-suite when debating a merger, and it has the ability to sink the whole ship.

And that’s corporate culture.

Failure to address corporate culture is the key barrier in up to 85% of failed mergers and acquisitions, according to a recent Mercer study. And, with visions of profits dancing in the heads of executives, it’s often neglected.

Imagine for a moment: Your established company’s CEO just announced a merger with a hip start-up. A flood of worry overcomes you and your coworkers around you. You’re sweating.

An announcement of a merger instantly hits on every one of the levels of Maslow’s Hierarchy of Needs:

  • Physiological: What if I have to relocate?
  • Safety: What if I have to compete for my job with an employee from the other company?
  • Belonging: How will I fit in with all these new people?
  • Esteem: Will I be respected? Will I be overlooked for that promotion?
  • Self-Actualization: Can I still achieve my personal and career goals?

When your people ask these questions, your company’s productivity takes a nosedive. Who has time to focus on getting that report done when they’re worried about where their next paycheck is coming from?

It also hurts individuals in the form of anxiety and stress. Being caught up in a merger can be a stressful thing for employees and families alike.

The good news: if you have a sustainable culture based on performance, you will retain your highest performers and give them a place to thrive, no matter the hurdles that come with a merger.

Staff meeting about merger or acquisition

Establishing a New Company Culture

What does culture really mean? Is it the anything-goes, or is it something else?

A Deloitte study establishes culture as “the long-standing, largely implicit shared values, beliefs, and assumptions that influence behavior, attitudes, and meaning in a company (or society).” And, like fingerprints, they’re never identical.

So, when companies combine, the two cultures need to blend seamlessly.

Instead of merging everyone under one of the old company cultures, find a way to unite everyone under a common set of values.

Consider centering your team under these five key areas of focus to create a seamless transition of values and culture:

  1. Performance
  2. Career
  3. Wellness
  4. Social
  5. Community

Related: How to optimize employee engagement and wellbeing initiatives to improve your corporate culture.

Two women smiling during a work meeting

Making Mergers and Acquisitions Work

With little signs of slowdown in mergers worldwide, it is more important than ever to have a performance-based culture rooted in respect of the individual.

As we had predicted, the volume of mergers and acquisitions grew 18% from 2014 to 2015—and 2016 is shaping up to be even larger.

Think about it in the context of nature: what happens when you combine bee hives? You run into issues because the bees are extremely loyal to their group.

While you can force them into one hive, companies don’t have the same luxury. Bees don’t quit their jobs, but your people can. And, if your company culture doesn’t resonate after a merger, they will quit (or fight to the death).

In human nature, you’re best off using respect, empathy and recognition of performance to get the most out of your people and make mergers work.

After all, remember this—culture rooted in respect is the honey that attracts people to your hive.

Rob Danna

Rob Danna

With a 25-year background in technology and sales management, Rob brings real-world performance improvement solutions to hundreds of large companies. As Vice President of Sales and Marketing at ITA Group, he prides himself by staying on the front lines of performance improvement technology and innovation.