Cultural Integration a Problem in M&A

Lack of cultural integration process and planning as well as top talent flight are key people-related M&A concerns for senior business leaders the world over, according to a recent survey by financial services company Mercer.

In fact, throughout Asia, Latin America, North America and Europe, approximately one third to one half of respondents said that they have no process for assessing culture and leveraging results. These same deal leaders are also very worried about top talent leaving their organisations soon after M&A deals close, with 75 to 80% saying that they are “very” or “moderately” concerned.

“M&A activity poses multiple challenges for companies in today’s global economy, requiring innovative and practical strategies for retaining key talent and integrating organisational cultures,” said Graham Pearce, Leader for Mercer M&A Europe. “This is especially true for companies in markets where high levels of employee mobility and significant differences in workplace and local cultures make post-deal integration challenges a threat to the company’s performance.”

On a positive note, business leaders acknowledged that people-related issues are gaining more prominence in M&A situations than in the past. This is particularly true in Asia, where a full 84% agreed that people issues are more prominent, followed by Latin America (62%), North America (60%) and Europe (47%).