Integrating organisational cultures, focussing on transparency, and enhancing internal communications are key to successfully navigating mergers and acquisitions.
By Simon Kent
Bringing businesses together can be exciting. Creating a larger organisation that is able to do more and achieve greater success is something many business leaders aim to achieve. However, the process can also be divisive—even destructive. In particular, organisational culture can be difficult to manage or maintain, indeed for those in the business being bought, it can feel as if they are losing the culture they had. Without a clear plan or process, employees can be left confused, uncertain for their future or what the resulting organisation might be, and as Claire Hughes, HR business partner at Totalmobile points out, this can have deeper implications. It’s often the employees who have the skills and knowledge that drove the business to this point in the first place. The challenge for HR then, isn’t just making sure the new organisation is a better business, but to ensure the new organisation retains the talent it needs.
According to Hughes, successfully navigating a merger means considering the process from both sides: internally, to understand why the business was acquired and how it will fit into the company, and from the perspective of the acquired company, to understand what the future also looks like for them. “This dual perspective is vital,” she says, “as it can be unsettling for existing employees to navigate the uncertainty that comes with such transitions.” While a solid integration plan covering the basics of the merger is imperative, Hughes notes that the management of company culture needs to be part of the process too. “Whether the goal is to maintain separate cultures, blend them, or create a new one, the approach must be intentional and include clear actions within the plan to achieve the desired outcome,” she says.
Jodie Hill, managing partner at Thrive Law, agrees the consideration of people and processes lies behind an effective integration. Initiatives and communications must offer a space for sharing ideas and learning about both companies’ cultures. “Storytelling is important here,” says Hill, “as sharing the people behind the businesses helps build connections and a shared sense of purpose. Recognising individual contributions makes people feel part of something bigger and drives collaboration.”
Workshops, virtual town halls, and sentiment analysis are all useful tools for ensuring HR secures the crucial employee buy-in required, making sure everyone is aware of what’s happening around them and feels seen and heard.
“Encouraging honest conversations where everyone can express their concerns and hopes helps make the transition smoother and allows you to see any issues which may be brewing,” says Hill.
Craig Fines-Allin, chief people officer at Instant Offices, says his business has seen how organisations that prioritise empathy, transparency, and collaboration during these times are better equipped to build a thriving culture and therefore can retain top talent and maintain morale. “It’s about creating an environment where change feels less like a disruption and more like an opportunity for growth,” he says, “both for the business and the individuals within it.”
“Whether the goal is to maintain separate cultures, blend them, or create a new one, the approach must be intentional and include clear actions within the plan to achieve the desired outcome.” – Claire Hughes, Totalmobile
Cultural integration, says Fines-Allin, is one of the most overlooked but critical aspects of success in these transitions. “It’s not just about financials and operations,” he asserts. “It’s about people and values.” Conducting a cultural assessment of both organisations early on can help leaders identify areas of alignment as well as potential friction points. These insights can then guide the process from onboarding to leadership appointments, creating a cohesive and unified new organisation.
This is where HR can play to its strengths. With a view across the landscape of the merger, the function has the opportunity to celebrate shared successes and achievements at critical milestones along the way. HR leaders can also highlight the potential benefits to employees of being part of a bigger organization. They can share new roles, new organisational structures, and new development opportunities, all of which, as Fines-Allen remarks, can turn apprehension into excitement.
Andrew Saffron, director of Innermost Consulting and author of the book “Better Culture, Faster” offers another viewpoint on the cultural side of M&A. “The only reason to talk about culture is to determine whether your culture is going to help you to achieve your strategic goals or get in your way,” he says. “For example, if your organisation is bureaucratic, siloed, and hierarchical, it’s likely that you don’t move at speed, you’re missing opportunities, you’re wasting money, and duplicating effort.”
Whether the M&A exercise is simply one business taking another or two businesses merging on a more equal basis, the central message remains the same. Communication must be high on the agenda and there needs to be transparency throughout HR’s work.
With this in mind, Saffron says it’s worth remembering the adage that “there’s no such thing as a merger… it’s always an acquisition.” In other words, rather than merging cultures it is unavoidable that the ‘acquired’ employees will always feel subsumed into the existing culture. Therefore, that culture needs to be a positive one for the overall resulting organisation. It will take time for new employees to understand this culture and get on board, and it must be remembered that these new employees have a different view of that company culture that people in the acquiring business don’t necessarily appreciate.
Whether the M&A exercise is clearly one business taking another or two businesses merging on a more equal basis, the central message remains the same. Communication must be high on the agenda and there needs to be transparency throughout HR’s work. While this communication will ensure all employees—and especially those incoming—are made to feel heard and welcome it will also inform the process of understanding what elements of company culture can stay and what needs to change or evolve.
Saffron advocates the use of structured workshops among employee to aid the process, adding that while HR can design these initiatives, the workshops should led by senior people from within the organization. “The value of senior people showing up to genuinely demonstrate their interest in the new people’s experience is massive,” he says.
But while talking and listening is one thing, HR must always be sure to act upon the information it gathers. The new company culture will not simply materialise: HR must be active in developing this aspect of the new business. “Asking, but not acting, potentially makes things even worse because you’ve raised an expectation,” says Saffron. To this extent HR must lead by example, demonstrating how the new organisational culture is one where employees are not just listened to but have a real influence over their workplace.
