Uniting brands: how to promote cultural integration during M&A

Uniting brands: how to promote cultural integration during M&A

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Wednesday, June 19, 2019 | Vladimir Kacar

Bringing two companies together in a merger and acquisition (M&A) is a daunting task, and that extends to rebranding. There are thousands of logistics to consider, from branded assets and legal requirements to the timing of your rebrand budget. But that’s not all. You also need to promote and protect the cultural integration of your newly combined entity.

In this article, we’ll help you understand what’s at stake when it comes to cultural integration at the operational level during the rebranding process, and how to plan and implement brand change in a way that facilitates closer ties.

Because the truth is, cultural integration isn’t a single task that can be ticked off your to-do list. It’s an ongoing process, one you must contend with at a broad conceptual level and operationally, in the nitty-gritty details.

Cultural integration in mergers and acquisitions: what’s at stake

In many ways, merging two companies culturally is a lot like bringing two people together in a marriage. Even with a strong desire to enter the relationship, marriage partners typically bring with them two different backgrounds, experiences, and ways of operating. To succeed, couples must find a new way of functioning together.

The success of this very personal “integration” isn’t a foregone conclusion. (If you’ve ever disagreed with someone about how best to load a dishwasher, then you can understand why.) Ideally, the best elements of each person’s cultural background will inform a couple’s new way of functioning together as a family.

The same thing goes for M&A.

For M&A, successful cultural integration at the operational level means cherry-picking the best practices from each of the predecessor organizations and being able to map a new, inclusive definition of “this is how we do things here.” Doing so yields streamlined processes and new efficiencies for the new entity.

It also results in greater employee buy-in, since one company’s practices aren’t steamrolling over the practices of the other. Given the chance to share about their preferred operational procedures, branded assets, and tech stack, staff from both companies feel heard and valued. This same process also builds unity between the two previously independent teams as they work together in a constructive way to solve problems.

Cultural integration at the operational level

From an operational standpoint, cultural integration is both a goal and a byproduct of a successful M&A implementation.

Broadly speaking, you want the unity and efficiency that comes from cultural integration. But in order to achieve it, you’ll need to prioritize cultural integration in the way you navigate hundreds of individual points of operational integration—what we call rebranding implementation.

Over the course of an M&A, the marketing and other functional area staffs of the two companies will be required to come together again and again around everything from product packaging that meets regulatory requirements and real estate consolidations to financial planning, brand governance, and reorganizations of staff. All of these efforts bring individuals from both “sides” together as they discover and try to resolve pain points.

Cultural integration at the operational level means taking methodical, often pain-staking steps to rationalize and standardize the new entity’s operational protocols. And it means doing all that in a way that brings teams together around a shared goal rather than kicking up frustration and resentment.

It sounds challenging because it is. But with the right perspective and approach, your M&A can find success in this important arena.

Cultural integration: finding success 

Here’s how to handle rebrand planning and implementation in a way that promotes cultural integration and unity:

  • Involve staff from both organizations in decision-making. Allow team members “from both sides of the aisle” to have a voice and a stake in how the new entity will operate moving forward. If they feel they are being heard, staff from both organizations can rally around the larger goal of deciding on the best workflows. Here, an independent third party can keep such a meeting from running off the tracks.
  • Think long-term. The energy around rebranding tends to dissipate after the first days of a rebrand launch. Don’t make the mistake of being short-sighted. Many rebrands require two to three years to fully execute, and you likely still have much to do. You’ll need to maintain focus on operational points of integration well after the launch date. If you don’t, the rebrand may lose steam, and the cultural unity you’ve set in motion could dissolve.
  • Centralized oversight is key. For many M&A, an IMO (or integration management office) handles the rebrand through the planning and initial launch. But what happens after the IMO makes its exit? You must have a strong, centralized marketing function to keep cultural integration (and the rebrand overall) top of mind. If not, the responsibilities will fall to people in functional areas who have other day-to-day priorities and your momentum will likely falter. Worse, decentralized marketing structures (which may be another way of describing a lack of cultural integration) may lead to inconsistencies in how the brand is presented. This is especially true when it comes to global entities.
  • Harness the right tools. You need to use the right tools and manage all the many operational changes that need to be deployed. These tools should help manage time, money, and people—and communication, of course. Next, selecting and configuring the brand management system that best meets your organization’s needs is a big part of the puzzle.
  • Consider hiring a neutral third party. A neutral third-party can be invaluable in helping the many individuals and departments involved in rebranding to navigate the many operational ramifications of M&A and steer the course on cultural integration, too.

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