There are some words in the business world guaranteed to strike fear into the hearts of the most stalwart and experienced HR teams. Deploying them in even whispered terms can risk sending them into feverish murmuring, palpitations and surreptitious LinkedIn profile updates. And no, we’re not talking about ‘employee tribunals’ (this time).
New CEO. Merger. De-merger. ACQUISITION. (I’ll pause while the HR readers among you collect yourselves).
Each of these words signals pronounced, profound and potentially sustained periods of uncertainty and upheaval. The financial costs of something like a merger can be huge, and that’s just when they work. Let’s not even talk about when they fail (as the majority of mergers actually do).
When it comes to the money, we take the risk on these big changes because we are firmly committed to the idea that the investment will bear out – that the expense of bringing two businesses together, or installing a fresh new outsider CEO into the top seat will bring economic gains in the long run (or at least stave off complete dissolve).
But when it comes to the cultural pitfalls, it’s not hard to see why your HR and People teams wouldn’t want to take the risk.
At the heart of their anxiety is the question of culture – who are we as an organisation? What is it that makes this a unique place to work, keeps our people productive and happy, and inspires loyalty? Getting culture right is the preoccupation of any HR department worth its salt, and new CEOs, company mergers etc can be direct challenges to the integrity and longevity of that culture. Essentially, is your culture fit to withstand big change?
Bringing two organisations together for a merger is more than just deciding the best formulation of your blended new name and branding. How do you bring the cultures of two organisations together to create something that still works? What are the new behaviours expected of your employees for the new venture? Do you just keep the best aspects of both, or create something new? What’s your evidence for deciding what things to keep and which to lose? The larger or older your organisation, the more challenging it might be to find the answers. And the challenges are more pronounced in an acquisition – when the bigger brand completely subsumes the acquired, and all the people with it.
De-mergers are just as challenging. If it’s hard to work out who you are together, it’s even harder figuring out who you should be apart. Coming out of a de-merger can be much like coming out of a long-term relationship – you get the challenge, and burden, of working out who you are on your own.
A new CEO presents an entirely different consideration for company culture. Some arrive determined to put their stamp on things – whatever the cost. The spectre of the over-zealous serial entrepreneur with a handful of New Initiatives can be the stuff of nightmares – leading to unhappy employees and unhappier HR departments.
Others inherit a culture in crisis and don’t know how to fix it. More than once we’ve seen a new CEO brought in on the ticket for change, but with no structure or support on how to go about it. These are the ones who often risk making the biggest mistakes by stepping on the toes of already-disgruntled teams.
So how to create a culture fit to survive all this uncertainty?
In our experience, it always comes down to Purpose and Values. Purpose, to help you unite as an organisation around something to stand for that isn’t just increasing the bank balance. Values, to help guide your people in making decisions and defining the standards of behaviour for success.
Figuring those things out is hard but undeniably enjoyable work for everyone involved – it’s why O2 found their people “tangibly energised, motivated, and united” after we worked with them to find their Purpose. Even starting the conversation about culture through the lens of Purpose and Values can be hugely empowering for HR teams and wider employees – it gives permission to gather deep insights into how people are feeling, and allows you to establish robust connections between your culture and impact on productivity, wellbeing and business strategy.
Working to define your Purpose and Values can help you boost your culture in the face of change, or provide you with a valuable employee-engagement exercise when things get rough. To do it requires really looking at who you are, what you stand for and want to be. You might be surprised, and delighted, at what the answers might be.