Merging Organizational Culture

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When two organizations are merging together to form a new entity, numerous challenges and issues are faced by the leadership in the organization that needs to be handled in an effective and sensitive manner to ensure the success of the merger. One of the most important role of leadership is to minimize the conflict that can arise between the employees of erstwhile independent entities by bridging the gap in terms of working styles and practices, corporate culture, vision, goals and objectives. In order to make a merger successful, one of the foremost tasks for leadership is to ensure that the employees in the merged entity developed shared goals, objectives, vision and collaborate/coordinate with each other in an effective and efficient manner. The employees of individual entities need to bridge their differences in culture, working style and practices and resolve their differences quickly to develop a shared vision, mission and philosophy in the merged entity. Effective leadership ensures that such differences are handled efficiently, conflicts are resolved in a constructive manner and shared goals, objectives and mission/vision is established as quickly as possible. In the absence of these elements, the potential or desired benefits of the merger such as synergies will not be obtained and merger will become a failure.

Let us take the case of FIAT and Chrysler. These are two distinct organizations of large size and come from two distinct nations with huge differences in culture, customs, working styles and even management approach. Italians at FIAT come from a relationship oriented culture where relationships dominate tasks and are pre-requisite for the accomplishment of a transaction whereas Americans at Chrysler are from transactional culture that puts forth more ...