Sunday, August 3, 2025
Companies drive growth by building internal capacity, outsourcing work to third parties, or acquire a company and then take over their operations, marketing, etc. But what about the merger of two companies that are more-or-less equals (even though one is the “acquirer”)?
The rationale for most mergers always includes an expectation of synergies. But does this mean always cutting from the acquirer? Or is there another approach to a successful post-merger integration?
1) Handle the integration as an acquisition. And therefore transfer everything to the acquirer’s systems, processes, and organizational structure. Make sure that there is a single culture, and force everyone to use the acquirer’s vocabulary and branding. The message is simple: this is the way you should do things now. The old way, and your history, doesn’t matter. In the words of Star Trek and the Borg, “Submit”.
2) Handle the integration as a merger of equals. This approach recognizes that there is value everywhere, and that the post-merger task is to review each element of both organizations, and adopt the best, wherever it came from. The old way, and your history, do matter. But you should be prepared to let it go.
Merger of equals is far harder, but ultimately will result in an organization (and culture) that everyone sees as their own… if it’s done properly.
This week’s action plan:
Building a powerful post-merger integration plan begins with executive (and board) alignment. Before you even consider a merger, everyone must be on the same page and agree on which integration strategy is preferable. And after the transaction, the management teams from both companies must be completely aligned on the integration approach. If they are aligned, a powerful new culture will flow.
Leadership insight #1: There are a few areas where an acquirer may absolutely require submission to a standard: regulatory requirements and reporting standards come to mind. If levelling up in these non-negotiable areas is required, don’t lose the baby with the bathwater: Be vigilant to preserve a learn-from-each-other culture everywhere else.
Leadership insight #2: If alignment is so important, where does it come from? Two areas that are can help immensely: coaching conversations with the most senior leaders, and at an executive leadership retreat.
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