When culture eats the change management strategy for breakfast

As the principal partner of Solutia SDO, Jackie Clark has had a direct role in managing the people behind the technology that’s transformed businesses across Canada. When IT projects stall, this seasoned leader, who’s had a front seat watching tech transform business in Canada, knows how to manage people to get projects running again. This bi-weekly column is for leaders working on enterprise-wide projects searching for insight on navigating the issues and pain points that hijack success. We’ll be sharing the most common questions Clark hears from her clients and her responses to them. Do you want your project management problems solved? Leave a comment with your question or  Tweet Jackie @sdosolutia.

I’m leading the merger between two investment management organizations. The technology, products, services, and customer base merged successfully – but the staff did not. We had a change management plan and thought we did a great job communicating what was happening but the people didn’t mesh. It’s starting to impact our customer experience. What did we miss?

Perhaps not enough attention was given to the cultural impacts of the merger. Too often dealmakers focus on a few cultural similarities as proof of compatibility; failing to identify and then reconcile crucial differences that will wreck their chances for merger success.

I read this years ago and saved it because it’s a great analogy of the importance of cultural integration.

“Imagine a merger between a couple of bird organizations—one a swarm of blackbirds, the other a wedge of geese. The lead goose and the ranking blackbird come together to announce the deal. ‘It’s a merger of equals,’ they insist to the media. ‘We’re both in the same type of business and we share many of the same cultural attributes.’

“They honk and chirp about how the consolidation will give them competitive advantage in bird land. But when integration begins, their cultural differences make it impossible for them to fly together.”

“The geese travel in tight formation, a disciplined v-shaped flock winging dead ahead on the same plane, at the same speed, in the same direction. Meanwhile, the blackbirds swoop, reverse direction, dive, and scatter. Some regroup instantly in a new swarm, while others land or fly off in random pursuits. The attempt to integrate the two species produces aerial chaos.”

Not to compare top executives with a bunch of birdbrains, but many of them make the same bad assumptions during M&A deals.

Companies rely on experts in the deal-making process, but then turn cultural analysis and integration over to internal people who lack expertise in managing the political dynamics and psychological complexities involved.

To be successful, the operationalization of cultural strategy must belong to the leader – it should be driven down from the CEO level. As well, when project plans and budgets are created, make sure that there are parallel activities in place to analyze the cultures and try to address the gaps. Hire experts and go beyond the use of a traditional culture gap analysis or compatibility survey. Traditional organizational change management tools and methods simply won’t cut it when you’re playing at this level.

Jackie Clark
Jackie Clark
Program and change management expert in digital and data transformation, and technology system reengineering.

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