What’s one of the biggest mistakes companies make during PMI? Ignoring the issue of organizational culture—or addressing it only superficially.
Culture impacts everything in business operations. It influences what members of the organization value, how they set priorities and make decisions, what types of individuals are successful, and how people behave in the face of challenge or crisis.
When executives do not understand the cultural differences between two organizations and their implications for the PMI effort, they risk being blindsided by those differences, which can impact the results of the integration. By contrast, taking the time to analyze in detail the cultures of the two organizations, with eyes wide open, will put them in a position to:
What is the right culture for the new company? The answer will vary depending on the situation and the specific opportunity at hand. But in any PMI, the first step in defining the new culture is to identify the cultural differences between the two organizations, even before the deal is closed.
Using insights gained from the cultural diagnosis, the integration leadership team can decide what type of culture they want for the combined entity. The new culture may combine the best of both worlds, or it may adapt the two existing cultures in a way that supports the new organization’s strategy.
Here are four focus areas for driving a culture transformation: