3 Cultural Considerations Before an Acquisitions

When a company owner faces a potential exit, buyout or a purchase offer, he has to make several considerations. There are valuations to be done. It is important to value the company and look for the future prospects of the company. You need to see if it will dismantle the company or grow the company. They need to see if the culture of the two companies meet. Is there a cultural fit?

It is more than culmination of two corporate cultures and internal lunch and learns. It is about an organization’s values and how they translate into business when it is done. The top authority should address three elements: the existence of synergy; the potential for complementary offerings; and how the acquisition will improve the customer experience.

1. Synergies

It just isn’t a buzzword; it is an important consideration for the merger or an acquisition. Stable values are important to survive and thrive after a grueling merger. For an acquisition to be successful, all the values must be pointed out in the same direction. If it doesn’t happen, you may be stuck. It can lead to problems otherwise. Sometimes, opening new markets through an acquisition requires drastic change and the new business venture can be doomed from the start. This, therefore, is an important consideration going into the merger.

2. Complementary offerings

The second element that you need to consider is whether the offerings and audience is complementary. Is there a fit between the company’s product and services? If yes, fair enough. If no, the acquisition is worthless. Facebook and Instagram’s merger proved to be fruitful for it worked for each other’s user bases. They offerings were complementary. A misunderstanding could have led to problems that could not be solved easily. Before a merger, this needs to be looked upon. It needs to be seen whether the offerings are complementary and they must not give in the money without full satisfaction and surety.

3. Consider the customer

The final element that needs to be looked upon is that if the offer on the table has to do with how each company treats its customers. It needs to be seen if the customers will be happy if the deal is made. Since customers are the first priority, the deal must not do anything to harm the customer base. Instead it should widen the customer base and serve them properly. An acquisition of Pixar by Disney was fruitful as it ended up well for the fans of both the companies.