The role of culture in M&A
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When two organizations merge, the process of integration is not a homogeneous blending of two business entities but rather “unnatural” process of finding acceptable compromises between very different values, leadership styles, and workplace environments. More frequent than not, failing to bridge these differences leads to inability to find common grounds and irreconcilable management differences causing low employee morale, high attrition, loss of talent, deterioration of processes, and ultimately, a deal failure. And yet, cultural alignment, no matter how critical, is perhaps one of the most overlooked factors in determining the success of a merger or acquisition regardless of the size of the deal. Is it possible to address this process in the due diligence state even before the merger announcement is made?
I think you have valid points here, cultural alignment is one of the toughest items to properly plan for and address at any stage in the process. However, conducting cultural assessments during the due diligence phase to identify gaps between the two organizations can serve as a crucial starting point. Additionally, establishing a structured alignment plan as part of the integration process can help bridge these gaps and facilitate a smoother transition.
Theoretically yes, it is possible. In my experience though, the ones making decisions around the merger are more concerned in acquiring the company offering, instead of focusing on the underlining reasons behind the offering itself. The ones having to deal with the integration are usually the ones that see very clearly what will work and what won’t. But at that point, the decision makers are already on something else and assume that everything should be working nicely already.
You can likely do a high level assessment, like asking questions about the typical workweek and managers expectations of employees (i.e. does the current staff work 40 hours a week and your team normally runs over 50?). I just completed the functio integration module and recall the HR section mentioning interviewing people on the seller side – although the pool is probably pretty limited, you may be able to structure a couple of interviews during due diligence to help get some key insights on the companies culture and see if it is a fit for your business.
In my experience, you absolutely can start addressing cultural alignment during due diligence — and frankly, you should. I’ve led through M&A where we brought culture into the process early by talking to leaders, observing how decisions were made, and understanding what people truly valued in their day-to-day work. It wasn’t about surface-level statements, but really digging into behaviors and mindset. That early insight helped us anticipate points of friction and build an integration plan that was more than just systems and org charts — it was about people. Waiting until post-close is often too late.
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