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Identity crisis during merger mania

28 Feb 14:00 by

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It’s only two months now until Olswang and Nabarro disappear into the merger with CMS.  On the 1st May a City Powerhouse will be created making it the 6th largest law firm worldwide. Whilst mergers and acquisitions are nothing new within the legal industry, it is also prevalent in the FM industry, this merger has definitely captured my interest.

As a facilities management recruitment specialist who only recruits for law firms I strive to understand and appreciate the company culture to make sure I present candidates who not only have the skills and experience required, but are the right ‘fit’. So what does this merger mean in terms of combining three cultures in one? Will identities disappear? The Olswang and Nabarro brands will disappear but does that mean their cultures will too? Or will they somehow be absorbed into the new company? How do you create a new company culture from a merger?

Since mergers of this size are unusual within the legal sphere, I looked outside of the sector to find the Procter and Gamble (P&G) acquisition of Gillette in 2005. This example caught my attention as they were eager to keep the cultural balance within their organisations, and so implemented the following methods to prevent a ‘culture clash’:

1 Decatagorise

During an acquisition, there will be in-groups and out-groups. Members of the in-group have a tendency to homogenize members of the out-group, without attention to the diversity and differences within the out-group. P&G leadership took great pains to create integrated teams composed of both groups who worked on shared tasks, thus forcing them to personalise their interactions and focus on specific, shared goals within the business.

2 Recatagorise

P&G developed a superordinate category that included both groups to help overcome in-group/out-group biases. This preserved their cultural identities – and associated attributes – while creating a new, larger in-group. The challenge was then to create a new “we.”

3 Mutual differentiation

In-groups develop positive attitudes toward the out-group, while preserving their original identities.

Company culture is the personality of the business and defines the environment in which employees work. It includes a variety of elements such as working environment, company mission, values, ethics, expectations and goals. Culture is as important, if not more important, than business strategy, because it will either strengthen or undermine your business and the objectives you are trying to achieve. So how do you create an effective company culture?

  1. Learn from past experiences

  2. Create a culture that aligns with combined core values

  3. Employ people who compliment and believe in those values

  4. Work as a team
  5. Maintain, monitor and evolve your culture

However it is achieved, it is clear that bringing three companies together as one will be a definite challenge and one that I am sure all employees are watching closely, as is the wider business community. I wish them every success.  

Of course, no matter how good the intention, or how effective the process during M&A, the retention of employees can be difficult. During periods of change, it is common for employees to feel insecure about the future of their employment no matter how well communicated the process.  Generally people don’t like change and don’t like the unknown and this process creates both in abundance. Therefore, it is hardly surprising that many people seek new employment during these times.

If you are currently affected by an M&A process, then we are here to help. Whether you’d like support devising an effective benchmarking or outplacement strategy, or would like to discuss your career options, we at Talent FM have years of experience to share with you and hopefully make the path ahead a smoother one.