Cultural alignment: A people challenge during mergers, acquisitions

Organisations have to be vigilant about cultural alignment during mergers and acquisitions (M&As) or risk failing to address people challenges.

The absence of cultural alignment is one of the biggest causes of failed deals, according to Aon.

"For example, if one organisation allows remote working and limited meetings and the other organisation requires employees to work in the office and meet in person to make decisions, how will those two approaches be reconciled?" it states in an exclusive feature with HRD.

To address this potential issue, Aon suggests determining and articulating to employees the different cultures of the two organisations, as well as the values of the desired combined culture.

"After day one post-M&A, deploy a change and communication plan that helps to embed the organisation's go-forward culture in a tangible way for all employees so they are clear on what is expected of them," it adds.

People challenges during M&As

Aon offered the advice as it points out how people issues can be responsible for a failed deal.

"M&A is hard to get right because people challenges are not easily solved by a formulaic solution, and they require an understanding of business strategy as well as practical knowledge about how HR programmes and processes create change," it says.

According to Aon, HR professionals need to be knowledgeable and ready to address people challenges that emerge before, during, and after a deal is closed.

"The success of a merger or acquisition deal often comes down to people strategies," it says.

Learn more about the potential people challenges during M&As and how organisations can address them in this exclusive feature of Aon with HRD.