More than a decade ago, a national corporation involved in the entertainment vending business merged with another company whose vending experience was somewhat limited. Needless to say, the end result wasn’t what management told employees to expect. The two companies struggled to integrate culture and brand in the months immediately following the deal.
You need to know that this happens more often than it should. Companies do their proper due diligence prior to merging. They read the reports and do their own analyses. But when it comes time to bring the two companies together, they don’t seem to be able to look past their own cultures and brands to really understand the other’s.
What ends up happening in most cases is that the stronger of the two dominates culture and brand. The other company winds up being more or less assimilated. Even though the deal started out as a merger, it ends as an acquisition in all but name.
Assumptions Should Be Avoided
The first mistake in the vending merger was making too many assumptions. Both management teams did it. For example, on the day the merger was made official, supervisors at the vending company distributed literature and swag from the other company. It was done with the intention of introducing team members to their new partners.
Distributing literature and swag was not a bad idea. However, the two management teams just assumed it would mean something to their respective staffs. They assumed their separate cultures and brands would seamlessly blend simply because they wanted it to happen. Things didn’t turn out that way. To this day, the two companies still stand proudly on their distinct cultures and brands. You would never know they merged by looking at them.
All this is to say that assumptions should be avoided during merger transitions. Instead, management teams should make every effort to make everyone involved aware of how both company cultures and brands will be integrated to create something new.
Building New from the Ground Up
A good post-merger strategy includes plans to build a new culture and brand from the ground up, using what both companies already have as a foundation. Here’s the thing: it’s not as hard as it sounds. A comprehensive pre-merger due diligence report should provide the necessary information to get started.
Just like companies would use a valuation report as the foundation of building a solid financial base, information on company history, culture, and branding lays the foundation for building something new. It is all in how you use the information presented.
Failing to build from the ground up is essentially choosing to leave things to chance. The two management teams just assume the integration will go smoothly and that a new culture and brand will develop organically. That is rarely how it works. Leaving things to chance only leads to different goals and visions creating unnecessary conflict.
Mapping It All Out
So, how can companies successfully integrate culture and brand after a merger? There is no hard and fast process. However, a good starting point is to map things out before the deal is actually finalized. The two management teams sitting down and figuring out what they want the future to look like sets the stage for implementing the right strategies in a post-merger environment.
Due diligence analysis and accurate diligence reports can help companies decide whether or not a merger makes good financial sense. But when the time to merge finally arrives, culture and brand have to be integrated as well. That integration should not be left to chance.