Corporate Culture
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Corporate Culture
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Survey and Research Data

Mergers and Acquisitions – Marrying Cultures Is Difficult

A survey of 1,000 companies about mergers and acquisitions, undertaken by the United States company Watson Wyatt, found that:

  • less than 33% of companies attained desired profit goals after a merger
  • only 46% met expense-reduction goals, and
  • 64% of mergers failed to produce the expected benefits.

The majority of mergers and acquisitions do not achieve their promised potential: consensus is not reached, shareholder value often decreases, and integration becomes difficult. There are many causes for merger failure. However, a major reason is that little thought is given to the human factor, i.e. the difficult task of marrying two different corporate cultures. [10]

Corporate Culture and Employee Engagement

In 2006, a survey relating to corporate culture undertaken by Best Companies in the UK, found that the most effective means of securing employee engagement were:

  • flexible working (offered by 89% of survey respondents)
  • formal recognition (86%)
  • ad hoc benefits such as Christmas parties (79%)
  • performance-related bonuses (78%), and
  • extra holidays (74%).

It was reported that total recruitment costs per person averaged £30,000. Therefore, better staff retention would provide considerable savings. Two example organisations from the Top100 list reported the following:

  1. At Tower Homes, the staff turnover rate was 7% (the industry average was10%);
  2. At Rackspace Managed Hosting, the staff turnover rate was also 7%, while customer satisfaction and “preparedness to recommend Rackspace to others” was 80% (the industry average was 14%). [11]

Corporate Culture Crosses Generations

In a 2004 study by Deloitte, called “Generation and Gender in the Workplace,” the following key differences among generations were reported, i.e. “Baby Boomers” (born 1945-1964), “Generation X” (born 1965-1980), and “Generation Y” (born 1981 onwards):

  • Baby Boomer employees were more likely to be work-centric (22%) than Generation X (12%) or Generation Y (13%)
  • 41% of Baby Boomers were family-centric, compared to 50% of Generation Y and 52% of Generation X
  • Generation X fathers spent more time with their children (3.4 hours per workday compared to 2.2 hours for Baby Boomer fathers)
  • Baby Boomer and Generation X employees worked the longest paid and unpaid hours at their main jobs (an average of 45 and 44 hours per week, respectively)
  • Fewer employees overall want to move to positions of greater responsibility than in the past. Among college-educated men in all three generational divisions, 52% want to move into jobs with more responsibility compared to 68% in 1992. [12]

Corporate Culture Hindered Knowledge Sharing

In a 2006 worldwide survey on corporate culture, undertaken by Accenture, 250 senior executives reported the following:

  • 42% described knowledge capture/sharing as a challenge or a severe challenge. The most common obstacles were reported as being:
    • a lack of common business culture across locations (38%)
    • the absence of a knowledge support infrastructure with dedicated staff (37%), and
    • a lack of rewards for knowledge sharing (32%).

Based on 200 interviews, the Harvard Business Review (May 2007) reported that many employees, without justification, feel uncomfortable sharing their ideas. It was concluded that encouraging employees to feel safe enough to contribute fully required an organisation to make deep cultural changes, which altered how employees understood the likely costs of speaking up (both personal and immediate) against organisational and future benefits. [13]

Organisational Culture and Perceived Hypocrisy

396 US business and engineering graduates in full-time employment were surveyed to determine the factors that affected their perception of hypocrisy within organisations. There was a positive correlation between perceptions of corporate hypocrisy and an individual’s intention to leave an organisation. Importantly, the results showed no significant differences in gender, tenure of position, tenure within the organisation, or total work experience. The findings indicated that employees tend not to become “conditioned” by behavioural inconsistencies, but rather continue to make regular assessments. Perceptions of organisational hypocrisy tend to influence employees in terms of where they focus their energies and competencies. Employees are strongly influenced by management actions, organisational culture, and rewards. The consistency of expectations was regarded as a major factor contributing to the creation of a healthy climate that demonstrated low organisational hypocrisy. [14]


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