Services - Success Stories

A Media Company in the Midst of Multiple Mergers

The Situation

A media company had recently acquired two others in rapid succession. Now it was itself about to be acquired by a larger company in a fast-growing, highly competitive market in which key leaders could easily find another job if dissatisfied. The company wished to protect against the potential loss of key talent.

What We Did

Through interviews with key leaders and focus groups with next-level leaders from the three original companies, we conducted a comprehensive organizational and cultural assessment that allowed members of each group to share their perceptions about their original companies, the other companies involved, and the cultural differences among them. In addition, we conducted a comprehensive leadership assessment of the CEO to identify current and anticipated leadership challenges related to the recent and upcoming organizational changes.

The assessment process revealed that:

• A majority of leaders across the different groups were supportive of the identified strategy for the merged entity - providing a positive indicator for the merger's successful implementation.
• Participants in the focus groups did not believe an effective cultural integration had yet taken place.
• All of them agreed that senior leaders could have provided clearer, more consistent, and timely communications regarding the acquisition and integration processes.
• Key leaders perceived the CEO to be biased toward his original company and his handpicked management team; the leaders who joined through acquisition felt like second-class citizens - receiving less of his attention and respect - a perception that continued to persist well beyond the initial merger.
• Both acquired companies held strong biases about each other and the acquiring company, based primarily on hearsay and stereotypes as opposed to direct experience with each other; these biases, being firmly entrenched but overlooked by the new management structure, were increasingly creating divisiveness and conflict, hindering the integration process as well as overall productivity.

The Results

The CEO and executive team took decisive action in several ways:

• With feedback and coaching, the CEO was able to shift his behaviors to be more objective in his assessment of his team and more inclusive in his overall leadership of the new entity.
• Following a review of our assessment of the cultures and best practices of the three firms, the CEO actively pursued the creation of a new culture that incorporated best practices from each of the former companies, as well as from the most recently acquired company (an acquisition that took place during the course of our engagement).
• The executive team began to truly appreciate the role and impact that cultural issues can have in large-scale integration efforts and increasingly considered any changes in terms of the impact on performance and the attraction and retention of key talent.
• Senior leaders initiated a formal plan to address the outstanding cultural/organizational issues (e.g., alignment of expectations to rewards) and committed themselves to managing future mergers with a more conscious and deliberate approach.

The Outcome

Company leaders from the various acquired companies quickly shifted from a "wait and see" attitude to one of active commitment to implementing organizational and cultural changes to create alignment with the overall strategy. As a result, workplace satisfaction within the organization improved, followed quickly by productivity gains and market successes.

To obtain these results see our Organizational Effectiveness Services.