Why Mergers Almost Never Work

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Quoted from MySpace.. Read the Full Article Here

Fiat is taking over Chrysler after Daimler lost billions trying to do exactly the same thing. Time Warner and AOL ended up in a fiasco. GM lost Saab, Ford lost Jaguar and Land Rover and today we have the battle of Kraft taking over Cadbury.

Why do most of these mergers and acquisitions end up in disaster?

Because they don’t know the code… they don’t know their own code – their corporate code. They don’t understand that a corporation is a culture (rituals, myths, heroes) and has a code. They also don’t know the code of the company they want to acquire or merge with. Of course they end up experiencing a “Culture Clash” and “Cultural War”. Then they have no idea of the country culture code, (see how the Cadbury people in ..England.. are reacting to the American take over or the Danone disaster in China).

To succeed you need a corporate Psychologist-Anthropologist. You need a corporate culture Match Maker who can identify each corporate culture code and facilitate the creation of the NEW culture while keeping the best of each of the old cultures.

Royal Bank lost most of the brilliant people from Royal Trust when they acquired Royal Trust. Daimler lost ALL of the Chrysler executives when they took over Chrysler (most of them went to GM).

What is the value of a company if all of the brilliant people leave?

Mergers and acquisitions should bring more than the sum of their parts. How do we do that? By creating a new corporate culture that integrates the best of each original corporate culture. This new corporate culture should have “babies” with both companies DNA.

Continued on Dr. Rapielle’s MySpace blog