In terms of corporate culture, we should pursue a higher level of development on the basis of entrepreneurship, combined with the innovative ideas of company employees, or on the basis of retaining the ancient spirit of our nation.
Think about it, as an employee of a company, your idea is linked to the entrepreneurial spirit of the company. Then he will consciously find a way to survive for the enterprise. So the leaders of the company don't have to worry about how to lead the company forward. The staff will consciously rush forward!
The task of leaders is to integrate their entrepreneurial spirit and the ideas of company employees into the corporate culture! Let the enterprise develop better!
To discuss how to carry out cultural integration after M&A, we must first understand what problems may occur in corporate cultural integration after M&A and what are the reasons for these problems, so as to put forward targeted solutions according to these reasons.
The first part: the embodiment of corporate culture conflict
First, the conflict of business philosophy.
Different enterprises have different business ideas, and excellent enterprises often focus on the long-term and make appropriate long-term strategic plans; In the fierce market competition, operate with integrity and pursue "win-win" or "win-win". Moreover, some enterprises only pay attention to short-term interests and ignore long-term development; In the process of production and operation, they are keen on one-time game, short-sighted, and pay little attention to corporate reputation, let alone building corporate brands. Therefore, after the merger, the business philosophy may not be unified, resulting in conflicts.
Second, the conflict in decision-making management
Different business ideas lead to different decision-making mechanisms of enterprises. Some enterprises have long been accustomed to collective decision-making and centralized management; Some enterprises emphasize hierarchical decision-making, independent decision-making and personal responsibility to adapt to the fast-changing market requirements. This conflict of decision-making mechanism is particularly prominent among leaders from different management systems.
Third, the conflict of values.
Common values are the core of corporate culture. The conflict of values is often manifested as a deeper and broader contradiction. Values are highly subjective, which determines people's code of conduct and constitutes the core content of corporate culture. Different countries and nations have different value systems, and everyone will form unique values in long-term life practice. In the process of enterprise merger and acquisition, the conflict of enterprise culture is first reflected in the different values of individual employees. When different values come into contact, they will inevitably rub and collide with each other. Everyone is instinctively trying to maintain their long-term values and belittling others' values, so that they cannot form a unified code of conduct.
Fourth, labor and personnel contradictions.
Different employment systems based on differences in business philosophy and values will also become the forefront of conflicts. Some enterprises have long been accustomed to applying the measurement standards of administrative organs in selecting and employing people, and unilaterally emphasize political quality, job equivalence, personal resume, interpersonal relationship and so on. Therefore, the elected enterprise managers may not have management skills. However, excellent enterprises have broken this employment system and paid more attention to innovation quality, contribution, achievement and enterprise management ability. It is believed that enterprise development only needs these qualities. The resulting conceptual conflict not only brings contradictions to the management itself after the reorganization of the enterprise, but also brings great psychological pressure and confusion to the employees.
Part II: Analysis of the causes of the conflict.
In the corporate culture integration after M&A, there will be the following three problems.
First, there is a lack of cultural integration planning and careful planning before mergers and acquisitions.
According to Kearney Company's follow-up analysis and investigation on the global M&A case of 1 15, there are two stages with the highest risk of failure in the whole M&A process-one is strategic planning in advance, target screening and due diligence, and the other is post-merger integration stage. About 30% of the respondents believe that the planning stage before the acquisition is very critical, and this part of the work is exactly what China enterprises generally do not pay enough attention to at present, especially the corporate culture part of the M&A integration plan, which has not been paid due attention to in the whole acquisition and integration process of China enterprises.
Recently, a customer in Sichuan served by Peking University Zongheng Management Consulting Company (hereinafter referred to as Company A) was acquired by its parent company (hereinafter referred to as Company B), which is a typical case of insufficient attention to corporate culture integration in domestic enterprise mergers and acquisitions.
Company A is engaged in the manufacture of key core components of automobile engines. Before being acquired, it was in a leading position in the industry. It was the first listed company in the industry and was acquired by the current parent company in the late 1990s. Company B is a large hotel group in Hunan Province, and its hotel performance in Hunan Province is outstanding, far ahead of other competitors. For the strategic consideration of growth and risk diversification, Company B acquired Company A. ..
The regional culture and industry characteristics of Company A and Company B are quite different. Before the merger, Company B only investigated and analyzed the financial situation of Company A based on the previous acquisition experience of the same industry, without considering the problems that regional culture, industry culture and corporate culture will bring to the integration of the two, and without considering how to put forward targeted solutions. Therefore, from the beginning of M&A, due to the conflict of various cultures and concepts, the employees of leading enterprises in the industry at that time were seriously drained, and now they are in an embarrassing situation of being left behind by competitors, and even on the verge of bankruptcy last year.
Second, there is a lack of professional integration personnel responsible for the integration of the whole culture.
In a standardized M&A process, the personnel involved include: the top management of the target company, the middle and low-level employees of the target company, the new manager of the target company after merger and acquisition, and members of the M&A working group. M&A working groups are usually composed of middle and senior managers from marketing, finance, auditing, R&D, human resources, law and other departments. Once an agreement is reached, the working group can be dissolved quickly, and members can return to their daily work or join the M&A working group set up for the next M&A business. Therefore, the integration of merged enterprises is often organized by new leaders. However, we can easily find that this method has great disadvantages: first, new managers can't devote themselves to the integration work because they have more important responsibilities. Compared with cultural integration, he is more concerned about the profit rate, market share and customer satisfaction rate of new enterprises. Second, the absolute authority of new managers in the enterprise is likely to affect the smooth progress of integration. Because during the integration period, middle and lower employees urgently need to know the basic business situation and operation mechanism of M&A company, and need a bridge to communicate with M&A company. The new manager's time and energy are limited, so it is unrealistic to ask them to carry out these detailed tasks. Therefore, in practice, it is necessary for both sides of large-scale acquisition to introduce special integration personnel positions and give them certain rights to ensure the smooth integration work. But unfortunately, in the current integration practice, many M&A enterprises do not have full-time integration positions.
Third, information communication is not done well, and the integration method is simple and rude, which makes it impossible to achieve synergy.
In the whole process of cultural integration, the employees of the merged enterprise are eager to know the latest progress of M&A, the future development vision of the new company and their position in the new company. Unfortunately, in the practice of integration, this work has not been paid enough attention, and employees can't get detailed information about it. On the contrary, rumors are flying all over the sky, making enterprises full of anxiety, turmoil and uneasiness. On the one hand, the acquirer has not established smooth formal communication channels, and there are problems in information transmission and feedback; On the other hand, the managers of the acquirer are unwilling to communicate with the employees of the acquirer because they can't answer many questions raised by the latter, which may lead to fatal mistakes. According to a survey by McKinsey & Company, many employees who leave the company admit that one of the most important reasons for their departure is that they lack any information about mergers and acquisitions. They don't know the latest development of mergers and acquisitions, don't know their position in the new organization, and never expect to get a satisfactory position in the new company.
In addition, after the implementation of the acquisition, many enterprises also considered the issue of cultural integration. However, due to the simple and rude way of integration, the corresponding management mode and operation system were simply and forcibly copied from the acquirer to the acquired enterprise, and the integration of the two cultures did not go through enough patient communication and training guidance, which caused the resistance and strong resentment of the employees of the acquired party and easily led to the failure of the acquisition.
The third part: How to integrate the culture after the merger.
In view of the main reasons of the above-mentioned cultural conflicts, appropriate methods can be adopted to effectively integrate cultures.
First, choose a scientific integration mode and procedure, and make a careful integration plan as soon as possible.
Cultural integration has a strong practicality, which needs to consider the specific situation of mergers and acquisitions, and it is more complicated and has many variables. Therefore, before the integration begins, it is necessary to choose a scientific integration model and program to control it.
In the due diligence stage of M&A, we should start planning for the future cultural integration of the two companies. Although lawyers and accountants are responsible for financial and legal due diligence, a special integration team should be formed to study the information system, human resources, operating conditions, customer service and other important businesses of the enterprise. What needs to be particularly emphasized is that the acquirer should hire a special consultant to study the corporate culture of the target enterprise and compare it with its own enterprise, determine the types and characteristics of its corporate culture, and then determine the cultural integration mode according to the M&A goal.
Second, the introduction of full-time integration personnel
As mentioned above, because there are many difficulties and subtleties in the integration of M&A enterprises and the merged enterprises, it is of great benefit to introduce full-time cultural integrators in the integration process. Full-time integration personnel are fully responsible for the integrated business after the merger, and are responsible for training the employees of the merged enterprise on the basis of ensuring the effective combination of the business operations of the two enterprises within the guarantee period, so that the employees of the parent enterprise can accommodate the merged enterprise. The responsibilities of full-time integration personnel can be summarized as four aspects: promoting the integration process, building integration institutions, promoting internal and external exchanges of enterprises, and ensuring short-term results.
Because of the particularity of M&A case, no two enterprises in the world are the same in integration. Therefore, for full-time integrators, there is no fixed job description and no fixed work boundary. Full-time integrators must rely on their enthusiasm and experience to enter the role as soon as possible, clarify their job responsibilities, what to do every day, what problems to pay attention to, who to contact, how to add value and so on. This requires full-time integrators to have strong independent judgment, be good at listening, and know when to intervene to make things move in the right direction. A deep understanding of the parent company is also one of the necessary conditions for full-time integrators. He can explain to you the strategic objectives and culture of the enterprise, who has what kind of authority and who can solve the problem. In addition, full-time integration personnel should also meet the following conditions: (1) with personality charm and personality charm, strong interpersonal skills, easy to generate trust; (2) Very sensitive to cultural differences; (3) Don't stick to the integration of your original daily work field, but also have a global view; (4) In order to integrate into multinational M&A enterprises, we must have a solid foreign language foundation.
Third, strengthen communication.
Almost all post-merger integration will be hindered by some obstacles, whether from cultural conflicts, insufficient work or unclear responsibilities of leaders. The only solution is effective communication. Communication helps to stabilize business and reduce the sudden appearance of "safe island" effect. When employees don't understand the reasons for mergers and acquisitions, or how to work together, this "safe island" effect will occur, and employees will return to the most familiar old road and do things in the familiar way as if the merger had not happened. After that, the motivation will disappear bit by bit, and there will be slowdowns, overdue work and even refusal to work. Once this effect is formed and communicated, the effect will be greatly reduced. Therefore, it is necessary to establish a communication working group in the early stage of the integration process, which will help to eliminate doubts and uncertainties among employees, customers, suppliers and all other major shareholders.
In the whole integration process, communication occupies a very important position. It can be said that many misunderstandings and confrontations in integration are caused by poor communication. In order to avoid these situations, M&A enterprises should establish various forms of communication channels to ensure the smooth flow of all kinds of information in formal channels, and should have the opportunity to let employees know the general situation of M&A, such as changes in equity, future business direction and so on. GE Finance advocates 48-hour lightning communication among employees, explaining to them all aspects involved in the merger, basic principles, expected profits and the impact on productivity. Cisco is another enterprise with a rich history of M&A. Immediately after M&A, they distributed a folder to employees of the merged enterprise, which contained the basic information of the owner of the new enterprise, the telephone number and e-mail address of Cisco's senior manager, and an 8-page chart to compare the differences between the two enterprises in terms of holidays, retirement, insurance and other benefits. These are very good practices and can be applied in the process of cultural integration.
Part IV: Types of cultural integration.
Cultural integration is not necessarily to eliminate the culture of the acquired enterprise. On the contrary, if the acquired enterprise has a strong culture, it should strengthen cultural construction to ensure the normal and efficient operation of the acquired enterprise. Just as IBM has retained the vibrant corporate culture of Lotus. In the specific operation of cultural integration, we should pay attention to the following three aspects: first, attach importance to the corporate culture of both sides, second, strengthen communication, and third, promote mutual adaptation.
The types of cultural integration in enterprise restructuring are mainly determined by the strength and adaptability of corporate cultures of both sides and the strategic objectives of enterprise restructuring. Different enterprises will carry out cultural integration in different ways. According to the change degree of corporate culture of both parties and the depth of corporate control acquired by the acquirer, there are four modes of corporate culture integration: substitution, integration, promotion and isolation.
1. Enterprises with strong culture often adopt an alternative cultural integration model when reorganizing enterprises with weak culture. Strong enterprises export their own management mode and cultural mode to weak enterprises, promote the fundamental change of weak enterprise culture, and finally replace each other's weak culture with their own strong culture. The acquired party completely abandons the original values and behavioral assumptions and fully accepts the corporate culture of the acquired party, thus enabling the acquired party to gain complete corporate control. Given that culture is rooted in the depths of the soul through long-term habits, it is difficult to give up easily. This model is only applicable to the situation that the acquired culture is very strong and excellent, which can win the unanimous approval of the employees of the acquired enterprise, but the original culture of the acquired enterprise is weak.
2. The cultural integration of both parties to the merger and acquisition is generally more suitable to adopt the integrated cultural integration model, because both sides have their own cultural specialties, and no one can replace the other's culture. This mode of cultural integration is suitable for the situation that both sides have similar corporate culture intensity, appreciate each other's corporate culture and are willing to adjust some disadvantages in the original culture. In the process of integration, M&A and M&A have infiltrated each other in culture, adjusted to varying degrees, learned from each other and absorbed the advantages of each other's culture, and assimilated each other in culture, so that two different cultures can finally be combined into a better new corporate culture.
3. If the corporate culture of the acquired party is stronger and better, it is more suitable to adopt the mode of promoting cultural integration. The high-quality cultural intensity of the acquirer is relatively weak, while the inferior cultural intensity of the acquired enterprise is relatively strong. The merged enterprise should not only strengthen its high-quality culture, but also transform the inferior culture of the merged enterprise, so that the two sides can form a new culture with strong advantages that is more suitable for cooperation and promotes enterprise development. This kind of merger often encounters great resistance, and enterprise managers play an important role in it.
4. In addition, in various types of M&A, there are situations where the characteristics of the two sides are too different, and the cultural backgrounds are very different, even mutually exclusive or antagonistic, so in this case, an isolated cultural integration model should be adopted. In the case of great difficulty and cost of cultural integration, it will be more conducive to the development of both sides if they can maintain their cultural independence and avoid cultural conflicts. This cultural integration is mainly applicable to mergers and acquisitions between some multinational companies or completely unrelated industries.
The influence of the original culture of the enterprise on the choice of cultural integration mode is mainly manifested in the tolerance of the acquirer to multiculturalism. According to the tolerance of enterprises to cultural differences, corporate culture can be divided into monoculture and multiculturalism. Monocultural enterprises strive to achieve cultural unity. Multicultural enterprises not only allow multiculturalism to exist, but also identify with it and even encourage and cultivate it. Therefore, multicultural M&A enterprises regard multiculturalism as their assets, and often allow the acquiree to keep their own culture. On the contrary, enterprises with a single culture emphasize the unity of goals, strategies and management, and do not want to be acquired by enterprises with different cultures.
Based on the above two factors, there are several different combinations for M&A company to choose from:
1. When M&A occurs in related industries (such as horizontal merger and acquisition strategy) and the acquirer is a diversified enterprise, the integrated cultural integration mode can be selected. At this time, the acquired party will be allowed to retain part of the corporate culture, and both parties will strive to seek various synergies.
2. If the acquirer of horizontal M&A is a single cultural enterprise, you can choose an alternative mode of cultural integration-instilling your own culture into the acquired enterprise.
3. When M&A occurs in unrelated industries (such as vertical integration merger strategy and diversified merger strategy), M&A tolerant of multiculturalism can choose the mode of promoting or isolating cultural integration.