How to facilitate cultural integration after your merger


January 2, 2019 / Startup / Greg Atkinson

After the dust has settled on months of negotiations and back-and-forth, you are finally merged. Congratulations! But it’s not quite business as usual. Integration of new personnel and systems is not a straightforward procedural exercise. Instead, it’s a careful assimilation into an existing culture, as well as a creation of a whole new one. Proper cultural integration post-merger will determine whether your new organisation pulls together as a united entity, or struggles along in a forced marriage of disparate factions.

What is cultural integration?

how to integrate teams in a merger

The culture you foster behind the glass is fundamental to your success.

‘Culture’ in this sense is a matter of expectations. Each company has its own set of unwritten rules. These may include things like not leaving before the supervisor does, bringing cake on birthdays, or easing into meetings with small talk. Though seemingly innocuous taken in isolation, these things combine to form a very distinct corporate environment. Adherence to rules signify to others that you’re part of the team. Disobedience, whether through ignorance or intent, immediately sets you apart.

Sociologist Kate Fox points out in her book Watching the English that English people expect to settle into a meeting with small talk about the weather or traffic or other mundane subjects before any sort of serious business is broached. Their German or Japanese colleagues may regard this as an awful waste of time. In advertising, some agencies expect a copywriter to stay on while her art director works, as a show of solidarity. Other agencies decry this as an empty gesture, and a burden on overtime pay. In certain companies, junior employees treat seniors to coffee as a sign of respect. In others, higher-earning employees will pay instead. The culture of each company demands that certain norms be adhered to, and if such matters are not consciously brought to the attention of newly merged teams, one side may regard the other as rude or unprofessional, without realising that it is simply a difference in expectations. Cultural integration simply means that everyone knows what to expect.

3 models of acculturation

In their seminal work, The Polish Peasant in Europe and America, Thomas and Znaniecki propose 3 modes of cultural assimilation:

Bohemian: where the adopter assimilates completely, abandoning his own culture
Philistine: rejection of the host culture, and preserving of one’s own
Creative-type: adapting to the host culture, while preserving one’s own

Post-merger, the norms of the acquirer will prevail initially. However, over time, new understandings will evolve. Therefore, employees of the acquiree must be taught the unwritten rules, employees of the acquirer must be given this teaching responsibility, and over time, both sets of employees will collectively create the new way of being. In this model, both the ‘host’ and the ‘immigrant’ assimilates by adopting the creative-type approach, preserving some of the old while creating something new.

3-step plan to encourage cultural integration

While the new culture may form organically, management can take active steps to help their people integrate.

Step 1: Crash course on majority rules

merger integration

Make sure they know the rules. Even the unwritten ones.

Unwritten rules are also unsaid rules. But without being told, how is a newcomer to know? In addition to workshops on new systems and procedures, acquiree employees should be given a crash course on what the majority expects. The existing cultural objective should be clearly defined (whether by the C-suite or by the team concerned), and points of dissimilarity should be identified. Note that this step of cultural integration is often a top-down approach, with management explaining what is required from staff. This is in contrast to the bottom-up approach which we’ll discuss in the 3rd step of culture creation.

While this is a stopgap to reduce friction in the short term, creation of a new culture requires mutual understanding from both sides. This can be achieved by more social interactions between colleagues.

Step 2: Socialising outside work

team building after a merger

Encourage team outings after hours.

While it’s natural for employees to feel an affinity towards the people they’ve worked with for longer, in order to foster better relations between the acquirer and the acquiree, you should encourage and facilitate more opportunities for social interaction.

With the help of networking tools like Kalido, you can set up interest or sport groups, and encourage active participation among your employees. Simply create a company network, or a network for any interest or sport, and invite your employees to join. Network members can see each other’s profile, including skills and interests. This paints a much fuller picture of someone beyond their job title. Particularly for employees who find themselves in a new city or new office, or conversely, are welcoming new colleagues to their office, such information provides talking points to help build relationships.

Users can also see each other’s contacts, including shared ones or ones they can be introduced to. Shared contacts are a great source of information about people, able to give perspectives that may be hard to come by otherwise. Alternatively, users can also ask their colleagues for introductions to new contacts, increasing their own circles effortlessly.

Network administrators can post notifications that reach all members, making coordinating or changing plans less of a hassle. Network members will also be notified if other members are nearby, so impromptu lunches or drinks can be arranged. Kalido users can also call or chat with each other for free, which encourages more interaction.

Social identity theory tells us that the distinction between in-group and out-group often depends on affiliation with causes or philosophies. So, in-groups can be created around things like interests or hobbies. As individuals are multi-faceted, one person can belong to numerous groups. Through membership in these groups, individuals can get to know one other and interact with more colleagues. For example, a person could join the work running group, which gathers for a 5km run each day. On Tuesdays, the same person could attend the company book club. On Thursdays – indie movie nights. Each group is comprised of different colleagues, united by a common cause or interest. As a member of multiple groups, and by socialising outside of work, one person can get to know many colleagues on a personal level.

Once your employees know and like each other, creation of a new culture becomes possible.

Step 3: Creation of new culture

company culture

Your new culture should be an evolution, not a revolution.

While unfamiliarity breeds distrust and lack of communication, familiarity improves transparency and cooperation. The exercise of creating a new culture will repeat some of the steps of the crash course stage, but with both acquirer and acquiree in the learning seat.

As an organisation, clearly define the kind of culture you want. This is different from the crash course in step 1, where the definition entailed a description of what is. Rather, you should focus on what can be. Next, allow as much input as possible from the entire team. Instead of a top-down approach, you could try a bottom-up method. Air as many opinions, suggestions, and grievances as possible. Allow both the former acquirer and acquiree equal say. Compromise, and collate the end result.

Next, appoint culture keepers who are responsible for the safekeeping and disseminating of the new cultural norms. While acquirer employees were responsible for this function previously, the new culture keepers should be drawn from both acquirer and acquiree. This is an acknowledgment of the teamwork which created the new set of rules. Management consultant company Bain also recommends introducing and tracking KPI to see how the new culture is being implemented.

While mergers are meant to pool the resources of the two companies to create a stronger whole, badly managed culture clashes could sap morale and destroy any chance of synergy and cooperation. Having a good plan in place from the very beginning can ensure that the best of your previous culture is preserved, and an exciting and harmonious new culture is created.