Research into companies involved in cross-border mergers and acquisitions points to failure rates of up to 70% with very few deals enhancing shareholder value. When analysed in more detail, the overwhelming majority of senior personnel highlight culture and communication as the two areas that prove to be the most challenging.
This is substantiated by a survey of Fortune 500 CFOs where 45% attributed M&A failure to “unexpected post-deal people problems”. Issues ranging from corporate governance to employee welfare or customer satisfaction become complex when different cultures are involved. Understanding the opportunities and threats inherent in bringing two different businesses, cultures and peoples together must form a key part of any pre and post-merger integration strategy.