Merger or Acquisition Study

​What is it?

A merger or acquisition (M&A) study focuses on the people side of two organizations coming together as one.  The first chapter of every book on M&As warns about the grave risks of not managing the organizational culture aspects of an integration.  But good luck finding any specific advice in subsequent chapters on precisely how it's done!  The most brilliantly planned union could end up in shambles if the cultures or leadership styles of the respective organizations are so different that they collide.  If the leadership teams have fundamentally different values, priorities or management styles, for example, the merger could be headache-ridden at the least, if not a complete and utter disaster.  And if the merger involves two or more nationalities, this adds yet another layer of complexity that must be managed to ensure a successful coming together.

It is best to conduct a merger study as early as possible in order to address issues before they become embedded in the new organization.  It may be tempting not to highlight organizational culture or leadership style differences to avoid any conflict.  But it is far better to identify and manage these differences, rather than turn a blind eye and hope for the best.  A merger study ensures that the leadership teams embark on their adventure with eyes wide open.

​​What is measured?

​The following are typical topics probed by the merger or acquisition survey.  The precise questionnaire content is guided by the interview findings, merger plans and what each leadership team would like to learn about potential obstacles and greatest opportunities that lie ahead.

• Vision and strategy
• Leadership effectiveness
  
• Competitiveness
  
• Organizational structure
  
• Decision-making style and effectiveness
  
• Leadership teamwork
  
• Performance management
  
• Leadership style
  
• Organizational culture
  
• Leadership morale
  

​​How is it conducted?

Merging two distinct corporate cultures must begin at the top.  It is imperative to gather the best senior-level insights about the desired post-merger culture and potential obstacles to a smooth integration.   This includes identifying critical strategic issues facing the new organization, such as key competitive advantages, the most urgent competitive threats, crucial vulnerabilities, best- and worst-case scenarios for the future and greatest unrealized opportunities.

A merger or acquisition study is conducted in a manner similar to a Senior Leader Strategic Insight Survey (learn more).  The primary difference, however, is that it involves the senior leaders of both companies.  It begins with a series of one-on-one interviews with selected members of both leadership teams, followed by a survey of all senior leaders in both companies.  It first asks them to describe the culture and leadership style of their respective companies, then asks them to “peer over the fence” and describe their views of the other company and its senior leaders and finally asks everyone involved to cast eyes on the horizon and describe their vision of the future merged enterprise.  This allows one to establish where each company currently stands, identify perceptions ... and misconceptions ... of each other, determine where both teams want to be post-merger and anticipate the biggest potential obstacles to a seamless union.

As is true with any senior leadership study, gathering candid information at the highest echelons can be particularly challenging since senior leaders have so much at stake – money, position, status, power, etc.  Dysfunctional dynamics such as company politics, a conflict-averse culture, entrenched power struggles or ideological differences can undermine open discussion and debate of vital issues – hence, the need for an anonymous opportunity to ensure that the most urgent issues that need to be talked about … are talked about.   The last thing any executive team can afford, particularly during a merger, is an elephant in the room that is being ignored.

Regarding employees during a merger, it will be a time of great uncertainty, particularly if there is a potential job elimination cloud overhead.  The speed and success of getting employees through the transition can be managed.  But it will require a cohesive and determined leadership team with a crystal clear vision of the future, an inspiring message and sure strong hands at the helm.  It is best not to conduct any full-scale employee survey until after the initial merger dust has settled.  However, it is reasonable to conduct a handful of employee focus-groups.  The aim is to get a “high-altitude” view of their perceptions of the new organization that can be coupled with the senior-level input to provide a more complete picture of the situation.  Employees naturally will want to lament about the past and their fears of the future, but the sessions can be managed to keep their focus on the opportunities, particularly the strengths and values they would like to see preserved and the most pressing issues they would like senior leaders to address to make the new company a more effective and successful enterprise.