Every organization can learn plenty from Sydney Finkelstein’s book, Why Smart Executives Fail. He and his team did six years of research, interviewing executives, employees, customers, and other stakeholders intimately familiar with dozens of examples of organizational failure. The team distilled the information they gathered into 3 parts: Great Corporate Mistakes, The Causes of Failure, and Learning from Mistakes.
Great corporate mistakes occur primarily during these four business challenges:
- Creating successful new ventures
- Managing mergers and acquisitions
- Coping with innovation and change
- Developing winning strategies in the face of new competitive pressures
Since more than half of mergers & acquisitions fail and the business world has seen so many in the last few years, that section was most interesting to me. First, Finkelstein gives an overview of three different companies who failed when making acquisitions. Then, he points out how the executives could have avoided their mistakes with an increase in due diligence, a deeper understating of synergy, and better communication.
If your role is in talent development or learning and development, helping your organization communicate better is how you can help keep mergers & acquisitions from failing. Prior to the deal, we should strive for “absolute clarity within the organization on the purpose of the acquisition.” Poor communication following the deal can lead to “cultural disruptions.”
Does your organization struggle with communication during mergers & acquisitions? You’re not alone – “disseminating information in an accessible way is a challenge all companies face.”
Finkelstein’s recommendations for better communication include:
- Celebrate wins: “look for small wins early on, and give the team a chance to celebrate those wins”
- Tell stories: “stories are the currency of culture”
- Share the stories with new employees: “the best companies share [their] stories in orientation programs”
- Create a culture of learning: “one of the most vital of all executive roles is to create a learning organization”
How can you put these recommendations into practice? At Paradigm Learning, we recommend the use of a Discovery Map® Program to communicate the change (like a merger or acquisition) with new and existing employees, share organizational success stories, and further your learning culture.
Discovery Map Programs:
- Are fully customized 1- to 2-hour discovery learning sessions—with an engaging,
metaphor-rich visual as a centerpiece
- Guide teams of participants to develop powerful insights and shared commitment to organization’s key strategies
- Allow all employees to understand where the organization is going, why change is required, and how they fit into the picture of success.
- Encourage crystal clear two-way communication, which increases each employee’s alignment and commitment