Culture trumps whether hiring or acquiring
by Miki SaxonRecently, the conversation at Slacker Manager turned to how a manager bounces back from a bad hiring. Although the five steps Barry Moltz listed are good, I commented that they didn’t include making hiring a priority and core competency, which would do much to alleviate bad hires. (Barry agreed:)
In most instances, the key to a bad hire is poor synergy between the candidate and the corporate culture. Culture is also the culprit in most screwed up M&A.
There’s actually not a lot of difference between hiring one person and acquiring/merging two companies. No matter how complementary the skills, technology and experience, cultural incompatibility usually leads to disaster.
There are dozens of examples to choose from—Alcatel-Lucent is one that’s happening right now.
Good technical synergies, but light-years apart culturally.
“But the cultures could hardly have been more different. One was hierarchical and centrally controlled, the other entrepreneurial and flexible.”
Don’t assume that the first description is Alcatel, it’s not.
[Lucent] retained a command-and-control style, and after years of restructuring, executives were so obsessed with cost-cutting that even the smallest purchase had to be logged into a central accounting system… “It was a slow-moving ship with an entitlement mentality,” says John Wright, a former Lucent vice-president…”
While it may be that the candidate is the ship, it’s just as possible that she’s a speedboat. Either way synergy is unlikely and conflict almost inevitable.
While culture may not be obvious when acquiring or hiring, due diligence/interviewing is able to identify and explore it. The problem is that managers often ignore culture, because they believe they that theirs is ‘right’ and the other will change. It’s not a case of you/your company being right and ‘her/them’ being wrong, it’s a case of the pieces don’t fit—and 98% of the time you should see it coming.
Image credit: owaisk_4u
November 19th, 2013 at 1:15 am
[…] Very true, but it shouldn’t come as a surprise, as I said five years ago when I wrote Culture Trumps whether Hiring or Acquiring. […]