Situation: A US-based company is in the process of merging with a foreign company. The US company has multiple locations across the US, and there are cultural differences between these locations. The CEO has worked diligently to mitigate these differences. The foreign merger presents new challenges. How do you maintain company culture in a merger?
Advice from the CEOs:
Between some of the US locations, there has been a “we make money, but you spend money” perception. How did the company get past this?
The company adjusted metrics to demonstrate the contribution of each division to short and long-term profitability.
This information was communicated selectively to key opinion leaders within the company.
Use the lessons from this experience to plan post-merger communications and protocols that will contribute to team integration post-merger and improve the chances of merger success.
Focus on the common vision and interdependency of the teams. This accommodates differences in culture and encourages teams to appreciate each other’s contribution. Use the same technique during the merger.
Have lunch with CEOs of other companies that have been bought by foreign firms. Learn how they adapted to the new reality. Ask what worked or didn’t work. Seek specific details of solutions that were developed that could be applicable to the planned merger.
Become better educated on business culture in the country of the company with which you will merge. Seek experts who can give seminars to company employees on what to expect and how to work most effectively with workers and executives of the foreign company.
Situation: A CEO is struggling to manage conflicting demands from a key foreign client. The client frequently changes targets and priorities; however, the performance contract with the client does not allow variations from plan. In addition, the CEO and client have different expectations concerning ROI. How do you manage conflicting demands from a client?
from the CEOs:
or access expertise from an individual who knows both cultures to coach you on
intercultural communications. This will help you to avoid inadvertent miscommunications
where your well-intended queries are negatively interpreted by the other party.
interpretation is an increasingly important factor for multi-national business
there elements of the client’s structure and the agreement with the client that
offer significant benefit, but which are underappreciated by company staff?
to funding or allowance on expenditures that allow the company to increase
staff to meet company demands?
that staff are aware of these benefits and how critical these can be to the
company’s, and their future growth and income.
with the client’s leadership to outline the conflicts that the company faces
meeting the client’s needs and demands. Explain to them how these conflicts are
compromising the company’s ability to meet their needs. Once the conflicts in
priorities are clearly expressed this may help the client to understand and
resolve the conflicting demands.
may involve a considerable personal risk and cost to the CEO. However, if the
effort is successful it will, in the long-term, benefit both companies.
A founder CEO is faced with two options – either selling his company or buying
a complimentary company. The acquisition would fulfill his dream as CEO, but he
is concerned both about the synergy between the two entities and his ability to
manage the combined company. Should he sell, or buy the other company?
from the CEOs:
Given these concerns approach the
purchase opportunity skeptically. Be more prepared to say no than yes.
In evaluating his ability to run a
larger operation, the CEO should objectively assess his own abilities.
A good CEO is not a Superman. A good CEO
creates a viable business model and vision and hires a good team to bring that
model to reality.
Consider past accomplishments. In an
industry where nobody makes money the CEO has created a business model that is
sustainable, highly profitable, and technically superior. The only thing lacking
is size in terms of revenue.
The new opportunity – on the right terms
– can launch the company from dominance in a niche to dominance in a
significantly larger industry.
Assess the new opportunity both as a
technical and cultural match. If there is a good cultural match:
Fewer things must go right to add value.
The purchase provides a channel to a
The acquisition will rapidly speed company
The biggest concern will be the time to
manage both entities.
The most important factor will be the
chemistry between the two company teams. If the chemistry is good, the
combination offers reasonable assurance that the two teams will complement each
Look at the purchase as an opportunity to
build a win-win with enduring value.
In considering outside investors to
support the acquisition, be cautious about financial partners and the conditions
behind each financing option.