What are some ways to overcome cultural mismatch in an M&A?

In class, we learned about M&As. Mergers are when two companies combine, while acquisition is when one company acquires the rights to another company. The reasons why companies participate in M&As, especially with the recent events of pandemic, include:

• competition and growth
• acquire competitors to reduce threats
• develop new capabilities (products, technology, customer bases)
• synergies (diversify business values and leverage existing capabilities)

However, we also learned that 70-90% of M&As fail. For example, Bayer’s acquisition of Monsanto from the assignment this past week. The obstacles that prevent companies from achieving success includes:

• cultural mismatch
• poor integration process
• overpay for acquisition fees
• misleading values
• external factors

Especially with the last assignment we had in the class concerning Bayer’s failure in achieving successful results after acquiring Monsanto, I believe that company culture is very important and should be made a priority by companies. Their different outlooks and approaches in business activities is what I believe is one of the main reasons the acquisition led to unsatisfactory results. That leads to my question, what are some methods in overcoming this cultural mismatch?

Is this the question you were looking for? If so, place your order here to get started!