When you merge cultures well, value is created. When you don’t, value is destroyed. While some will suggest other factors – silly things like objectives and strategies and implementation – they are all derivative. The game is won or lost on the field of cultural integration. Get that wrong and nothing else matters.
I spoke with Wolff Olins’ strategy director, Nick O’Flaherty about applying the findings from their recent leadership study to mergers and acquisitions. He started by asking if Verizon and AOL are merging and acquiring like it’s 1999. He worries that they could be and suggests three key lessons from the “worst merger in history”.
- Clearly define the specific value that will be created from the merger.
- Fully integrate the two businesses.
- Ensure cultural compatibility.