Yesterday, Steve Case was on a Sunday morning show to talk about what he is doing now. Naturally, the journalist asked about the AOL/Time-Warner deal that so famously flopped.
Here’s what Steve said, in paraphrase – It was harder to bring the two companies together than we thought it would be and the cultures were so very different.
Few things are more obvious. Yet, time and again, the obvious difficulty of bringing together two companies is ignored. Leaders blame culture and integration as the cause of massive failures and losses in the billions of dollars. Whose job do they think it is to manage this? It’s theirs. It would be more honest and indeed, refreshing, if Steve had said “we were over-confident and did a bad job which cost many people a lot of money and others their jobs.”
Bringing together disparate cultures can be done. Look up Reckitt-Benckiser. If Bart Becht can do it, that means it can be done. Why is it so rare? A few reasons –
1. Over-confidence
2. Handing responsibility for integration to a functional head.
3. Failure to work on the ambiguous aspects, such as culture.
What are your options?
1. Get off the bandwagon. These deals take on a life of their own like a wagon racing on a downhill slope. The problem? No dynamic braking. If you are the leader, you are the brakes.
2. Get real. These things are not accomplished by edict but through leadership that takes responsibility for the obvious and ambiguous aspects of the deal.
3. Get help. Most organizations will get help for the obvious stuff, IT, HR, etc. The Chief Executive Officer doesn’t need to be involved in welding the pipes. She or he does need to be involved in shaping the future for the new organization and you can’t take control of your destiny if you leave organizational culture to chance.
4. Get moving. The integration must be considered before the deal is struck. Get help in the due diligence phase. Looking under the carpet early is risk management, it’s not a Human Resources task.
