Mergers, Acquisitions and Strategic Alliances

What Would It Be Worth to Increase the Odds of Success for Your Next Merger, Acquisition or Strategic Alliance?

If you’re contemplating a merger or already involved in one, you’re not alone. Mergers, acquisitions and alliances continue to boom worldwide as strategies to grow business. But, even with the increased refinement of financial and legal due diligence in recent years, the success rate is shockingly low. In fact, study after study shows that between 55 percent and 77 percent of mergers and acquisitions fail in their intended purpose.

Why so many failures? More often than not, the reason is “culture clash “-the inability of merged organizations to work together. When companies battle each other over “the way we do things around here,” they waste valuable time and energy. Better to focus on the things that matter, like customers, profits and keeping stock- holders happy.

Our unequivocal position is that although most M&A’s fail due to organizational culture clash the sad truth is that there are no two (or more) organizations that cannot successfully work together in a merger, acquisition or strategic alliance despite any difference in organizational culture.

 

Defining Cultural Due Diligence

Vector Group, Inc. invented the concept of cultural due diligence almost 20 years ago. We are also the first to create and effectively implement a behavior auditing process – Cultural Due Diligence (CDD) – to identify and resolve the issues of culture directly and proactively. Its purpose is to eliminate or minimize culture clash, and to enhance the transfer or development of loyalty and commitment to the newly combined organization.

Our contention is that there are no two (or more) organizations that cannot work together in a merger, acquisition or strategic alliance despite any organizational culture differences. “Culture clash” is just a way of describing management negligence.

Over the last 15 years, we have managed projects to effectively merge corporate cultures, create entirely new ones or modify culture clash when things have fallen apart after a merger or acquisition. Read more…