When Cultures Collide

Any organization that has gone through a merger has probably spent a lot of time and money ensuring that the “numbers” of the new organization will work. In contrast, few bother to look at what will really makes the new company successful – the people.

Organizations are made up of individuals whose combined attitudes, values and beliefs create an organizational culture that is unique to all others. When organizations merge, two cultures are thrown together, and that could result in a collision that will eventually destroy the new company.

On paper, many mergers make good business sense. One of the “textbook” reasons for business mergers is to utilize the strengths of both original companies to create synergies for the new organization. Yet, initially at least, mergers have a negative impact on the new organization. According to The Financial Post’s book, 100 Best Companies to Work for in Canada, it takes three or four years to “re-establish a working environment that employees would characterize as excellent.” In the mean time, “productivity goes down” and “the merger (has) a negative impact on employee morale.”[i] Worse, at the end of this “getting acquainted” period, the resulting culture might not be the one that senior management wants.

“When organizations merge, two cultures are thrown together, and that could result in a collision that will eventually destroy the new company.”

Senior Managers can make one of two decisions. They can wait the three or four years for “nature to take its course” or they can take control. 

Controlling the process involves a number of steps:

1. Measure the culture of the two original organizations. Human Synergistics Organizational Culture Inventory™ (OCI) measures the actual culture (the expected shared attitudes, values, and beliefs) against an Ideal one. Culture is measured around 12 styles. These 12 styles can be split into a number of clusters. First, there is a task vs. people split, then a satisfaction vs. security one, and finally a constructive vs. a defensive split.

2. De-brief each original organization on their existing, pre-merger culture – its strengths and weaknesses. This will help each side understand their culture, as well as what they are bringing to the table.

3. Share the results of both surveys with all parties. Understanding the other party’s culture vis-a-vis your own is the first major step in constructively merging them.

4. Decide on an Ideal new culture. Defining the new Ideal is easier than it appears. Human Synergistics research has found a positive correlation between Ideal cultures (high in achievement, humanistic-encouraging, affiliative and self-actualized orientation) and such outcomes as employee engagement and product quality.

5. Develop an action plan to have the new organization work towards the Ideal culture. There are several Causal Factors that have a direct effect on culture – leadership styles and practices, Human Resource systems, organizational and job design, the mission, philosophy and values of the new organization. But all of these factors are directly influenced by the leadership team.

An organization’s culture evolves over time or it can be directed by the management team. Many leaders who see shortcomings in their present culture often delay tackling the problem. Leaders who ignore culture during a merger, do so at their peril. Mergers can serve as an ideal catalyst to initiating cultural change because most people accept the fact that they are going to have to make changes.

Allan Stewart is the President of Human Synergistics Canada and has been helping organizations change their cultures for over thirty years. He is considered to be a leading expert on organizational culture, its causes and its outcomes.

[i] * Eva Innes, Jim Lyon, and Jim Harris, The Financial Post 100 Best Companies to Work for in Canada, (Revised Edition), Harpers, Collins Publishers Ltd., 1990. Page 1.

About the Author

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Allan Stewart

Allan Stewart has been the president of Human Synergistics Canada since 1996. His unique background combines a successful general management career with extensive workshop training experience and a varied academic career. Allan has conducted training programs for organizations in retail, finance, mining, manufacturing, energy, athletics, education, health care and various sectors of the government. He was a senior executive with Sears Canada Inc. and has been a professor at McMaster University and Sheridan College. He received his B.Com. from Queen’s University and his M.B.A. from Wilfrid Laurier University. Allan has over 30 years experience in developing and conducting training workshops. His past clients have included some of the largest and most successful organizations in Canada. He has trained executives, first-line supervisors, trainers, sales-people and line workers. He has been an instructor with the Executive Development Programs at McMaster, York Universities and the Ontario Police College. He has been a key-note speaker on television and at a number of professional conferences. He is considered a leading expert on organizational culture and development. Allan’s dynamic training style and practical approach make him a popular workshop facilitator who has helped people throughout Canada and internationally. He has written articles and workbooks on a variety of subjects, including culture, leadership, stress management, change leadership, entrepreneurship and selling. As well, Allan Stewart is a skilled consultant, interacting with individuals, teams and companies.  As a volunteer, Allan has conducted leadership skills workshops for youth in Canada's native communities and in third world countries. He has lead several charitable organizations, coached minor sports for over 20 years, counseled elite athletes, and developed and lead young entrepreneurs' programs.