Contact address

LLinE

KVS Foundation

Haapaniemenkatu 7 - 9

FIN-00530 HELSINKI

Finland

e-mail: lline (at) kvs.fi

phone: +358 (0)207 511 591

fax: +358 (0)207 511 502

Company culture decisive for successful mergers and acquisitions?

The past five years an unprecedented number of companies have been through mergers and acquisitions process. However, 50-80 percent of the companies merged fail to match their previous performance. Robert J. Thomas (the executive director of the Accenture Institute for High Performance Business in Wellesley, Massachusetts) suggests in the Outlook Journal that cultural incompatibility is behind many recently failed mergers and acquisitions such as Daimler-Benz and Chrysler and Citicorp and Travelers Group.

More than a third of senior UK executives said in a research (Change Partnership, February 2004) that ‘embedding the culture’ was the single most difficult task they faced. Senior executives need training to provide them with critical leadership skills which could help steer the merger or acquisition successfully. A recent survey by Adecco and the Chartered Management Institute (Business Energy Survey, October 2004), shows that of 1,500 managers, one in three had received no training in the last 12 months. The average UK company spend per head for management training less than half the amount spent by German companies says research by the Chartered Management Institute, the University of London and the DTI in June 2004.

Fitting into their employer’s workplace culture is more important to most staff than earning a higher salary. The survey (Reed Consulting, October 2004), also found that two out of every five workers say they have personally experienced cultures where their own workplace style clashed with that of the organisation.
Source: Jon Buttriss, Executive Director, Thomson NETg HR Zone