Nothing is ever in a vacuum and culture is no different. It’s like the weather: affected by the general climate and some big picture events, which can be unexpected and significant.
Take mergers, team bolt-ons or geographical expansion. These are all decided upon because they help drive the strategic agenda, they are logical decisions, they make financial sense and the various parties have an alignment of interests and common values. We do the deal because it is logical. Then we start to find the cracks. “We do it this way, they did it that way”, “they’re always excluding us from discussions”, “our system doesn’t talk to their system”, and (more worryingly) “we don’t have truly honest lines of communication with them to sort out the problems”. Why not? Because we speak a different language, perhaps literally in the case of global mergers (even across the English-speaking world!).
Consider how much time and money is wasted in integration issues which could have been resolved earlier in the process….. if only we had spent some money and time on getting people together and building a relationship early on in the process.
Putting culture high on the agenda
I have been working with a business who acquired an overseas team to provide it with global reach. They bought it five years ago yet still they have having integration issues, systems are not aligned and home office vs regional team relationships are challenging to say the least. The language is “them and us”, never “we”. Head office keep discovering issues that, frankly, if they had known at the start would have been deal beakers, but we are FIVE YEARS ON, and these are only just coming to light. Someone in the regional team knew all about these but didn’t have the relationship or perhaps the courage to bring them up. They have had to make a provision in the financial statements for an additional £3 million to resolve legacy issues. If they had spent a fraction of this five years ago and got the systems, the relationships and the cultures aligned, it would have saved a whole world of pain and money now!
Invest in relationships
The flip side was the case in a team bolt-on to a UK fixed income fund team which was part of a much larger asset management business. The UK team were a tight bunch and they acquired a business in the US, speaking a different language (yes American is different from English), in a different time zone with different systems and regulations. Integration was not easy but both the US and the UK team believed that time spent in integration was important. The US teams transitioned to the UK teams’ dealing systems, reporting structures etc and that took a great deal of dialogue, training and diplomacy. How did they do that? By focusing on relationships. They invested in offsites where everyone came together to share and air frustrations, opportunities, concerns and ambitions. They socialised together, creating some shared stories, they co-created a shared narrative. Off the back of this time they started an exchange programme where everyone in both teams spent two weeks in one another’s office. They took a serviced apartment in the UK and the US and rotated everyone through it. Why two weeks? Because it was long enough to get to know the other team, there was a weekend involved where each team member would host the other at their home, and over two weeks it is hard not to show some authentic cracks and problems. They were not trying to hide anything from each other. The individuals were still expected to do their day job, just from a different location, which developed some mutual respect for one another’s problems.
So please spend the money, time and effort on completing the integration. Don’t just assume the deal is done and move forward. Don’t just assume that integration is all about systems and processes. Instead, focus on the quality of the relationship between teams and individuals. Put people on flights (when we can!!) – relationships are not built on a video conference or through email. They are built over coffee, lunch or a glass of wine.
