Culture Assessments for Mergers and Acquisitions

Assessing an organization’s culture is important for any company, but there are few times when it is more critical than when a merger or acquisition (M&A) is on the horizon. If your company is acquiring another organization, don’t short-change an assessment of the new acquisition. It’s absolutely essential to get this right, and worth paying top dollar for as well. After all, you not only want to know, you need to know what kind of culture is coming on board, because it will definitely have an impact on your organization.

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For the specific M&A environment, there are a number of corporate culture diagnostic tools available, as selection of the top tools are presented below, with descriptive information about why they are good choices.

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Organizational Culture Assessment Instrument (OCAI). OCAI is a validated tool for assessing current and preferred organizational culture, developed by professors Robert Quinn and Kim Cameron of the University of Michigan, based on the Competing Values Framework. It’s been used by over 10,000 companies worldwide. It can also be tried for free at OCAI-Online. Note how one of the useful features here is that OCAI not only allows you to assess your culture, it can also be used to guide organizational culture change when such change is warranted. It has users rate six key aspects of organizational culture that have been found to determine success, with respondents assessing both the current and preferred organizational culture. The instrument will give the parties in an M&A scenario a clear picture of the current and desired cultures. Note, however, that it does require conscientious effort to help the financiers recognize that culture really can make or break an M&A.

Organizational Culture Inventory (OCI). Developed by Human Synergistics International, the OCI provides companies with a visual profile of their current operating cultures based on the behaviors that members believe are needed to “fit in and meet expectations.” This tool works especially well if there is already some understanding of the framework from within a leadership development and change context. It works even better if used within the context of a “strengths-based” dialogue that doesn’t get caught up in who’s got the “better” or “worse” culture. After all, the point is to leverage the good cultural DNA of both groups to build a new, shared, stronger culture. For more information, visit Organizational Culture Inventory.

Cultural Transformation Tools (CTT). Created by the UK-based Barrett Values Centre, this tool will give a good picture of where each organization is at in terms of culture. It maps out all the areas they have in common as well as the areas where they diverge, and also addresses the desired merged culture for optimum success. See the Barrett Values Centre for more information. One great reveal in this methodology is the amount of cultural entropy in each organization that opens up conversations around improving culture beyond merely merging cultures.

Organizational Health Index (OHI). Developed by McKinsey, the OHI is a thorough survey of an organization’s effectiveness and managerial practices. This tool gives results that are benchmarked against both industry leaders as well as regional trends. See Organizational Health Index for more information.

The Denison Organizational Culture Survey (DOCS). The DOCS has been used by thousands of companies worldwide over the 20+ years that it has been available. Similar to the OHI, results with the DOCS are benchmarked against scores stored in a global database of respondents. With 60 items that measure specific aspects of an organization’s culture in each of four traits and twelve management practices, the results can be translated nicely into an action plan that helps organizations improve practices. Visit The Denison Organizational Culture Survey for more information.

Although all of these tools can help you get a better grip on the cultures involved in an M&A scenario, it’s worth noting that none of them have successfully tied cultural factors in a formal, quantitative way to the successful prediction of financial outcomes. That being said, using any one of the above cultural assessments during an M&A can be both revealing and sobering in terms of what lies ahead.

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