Finally, someone has captured the full scope of the sustainability issue and resolved some of the inner conflict I have been experiencing lately.  Protecting the natural environment isn’t the whole story: companies must consider their social, economic, and cultural impact as well.  Sustainability is good business and therefore corporate social responsibility makes good sense to businesses and all of us. Intuitively I knew this but try to explain the logic in a ROI sense and it sometimes takes a leap of faith.  It is sort of like trying to convince people that “motivated” employees are more productive.  One doesn’t necessarily focus on just motivation.  Similarly, the focus isn’t just on sustainability but on a broader vision and (North Star) goal that is more holistic and longer term.  Adam Werback brings the issues together in a straight forward and simple way that is compelling.

The McKinsey article, When sustainability means more than ‘green’, is adapted from Adam Werback’s new book, Strategy for Sustainability: A Business Manifesto and  reprinted by permission of Harvard Business Press. Copyright © 2009.  Adam Werbach is the CEO of Saatchi & Saatchi, a former president of the Sierra Club (at age 23 in 1996), and the author of many works on sustainability, including the 1997 book Act Now, Apologize Later. I strongly encourage you to view this accompanying video interview, and then read the article.

True sustainability has four equal components:

• social, to address conditions that affect us all, including poverty, violence, injustice, education, public health, and labor and human rights
• economic, to help people and businesses meet their economic needs—for people: securing food, water, shelter, and creature comforts; for businesses: turning a profit
• environmental, to protect and restore the Earth—for example, by controlling climate change, preserving natural resources, and preventing waste
• cultural, to protect and value the diversity through which communities manifest their identity and cultivate traditions across generations

I took the title of this post from a recent article in Industry Week Manufacturing: Manufacturing Merger Success: The Sales Force Integration Imperative subtitled: “A powerful driver underlying B2B M&A outcomes is the degree to which sales forces are successfully integrated.”  This is a very good article by Michael B. Moorman.  While he focuses his attention on the Sales Force, the integration risks that frequently undermine the degree of merger success as identified by a study from his firm applies across the board.  We have seen them all before.  Moorman’s keys to success also transcend sales to be true within the whole organization,  Issues that we would describe slightly differently are:

• inappropriate downsizing
• poor customer interface
• loss of key personnel
• lack of attention of the immediate needs
• “us” versus “them” rather than a New Identity
• Dualities instead of synergies
• poor timing of implementation – in fact in our view at 1-Focus – to little too late.

For the past couple of years I have been reading articles that be-cries the need to get Informatics involved early in the M&A discussion.  Lately, this has spread to other groups as well.  Besides the mention of the Sales Force, I saw a demand to consider procurement in SourceWire last week.  ”PROCUREMENT CAN BRIDGE THE CULTURAL GAP IN COMPANY MERGERS”  Well that’s a pretty big affirmation. I don’t mean to sound glib.  You can actually download the White Paper “Bridging the gap: How procurement can add value in a post-merger situation” here.

Procurement impacts across all areas of an organisation and it is here that opportunities can be found to unlock synergies on both sides of the merger.

But again I say – what doesn’t?  Instead of looking at each function separately and pointing out how critical each is the success of any merger, we need to think systemically.  All systems are connected and unless we find meaningful ways to collaborate and develop bottom-up processes of including ALL aspects of the organization, we will not be as successful as we can be.

So what really is the Integration Imperative? Well it isn’t just one thing. We have identified five critical factors but a good place to start would be to review the White Paper which can be read here that I coauthored.

It has been a little difficult for our readers sometimes to order and download our first White Paper on Post Merger Integration so we have loaded up here for our readers.
Leading Cross-Cultural Re-Engagement Final

This came across my desk today and with good humor, I had to share it with you. The full post at Maggie’s Farm is by guest poster Bruce Kesler is Oy, Come All Ye Faithful: First Night of Hannukah (with Christmakah)   Maggie’s Farm describes itself as “a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics”.

Continuing the current trend of large-scale mergers and acquisitions, it was announced today at a press conference that Christmas and Chanukah will merge. According to reliable industry sources, the deal has been in the works for about 1300 years, ever since the rise of the Muslim Empire.

Massive layoffs are expected, with lords a-leaping and maids a-milking being hardest hit. Under conditions of the agreement, the letters on the dreydl, currently in Hebrew, will be replaced by Latin, thus becoming unintelligible to a much wider audience. Also, instead of translating to “A great miracle happened there,” the message on the dreydl will be the more generic: “Miraculous stuff happens.”

The Financial Times/ArcelorMittal Boldness in Business Awards will take place at the Tate Modern gallery, London, on March 19 2009. The categories, which will be nominated by a panel of judges, are: Drivers for Change; Corporate Responsibility; Environment; Emerging Markets; Entrepeneurship and Lifetime Achievement.  A couple of things caught my eye besides the title which in of itself is quite catchy. 

The definition of the first category is particularly interesting: Drivers of Change

Bold drivers of change see opportunity where others see only danger and are not afraid to transform their company and even their industry. They are not afraid of change and they are decisive. A bold mergers and acquisitions transaction, for example, is one that has the potential to transform the company that undertakes it – allowing it to dominate its own sector or to move into new ones. 

I suspect that the example of a bold M&A is in part in response to one of the sponsor, ArcelorMittal.  At 1-Focus, we have been following ArcelorMittal.  We have written before about how impressed we have been in their approach and integration strategy.  It follow the process that we have developed and it took into account (either by plan or default) the five critical factors.  I was amused by the first part of the definition.  For the past 20 years, all I have heard about is that change is always with us.  ”Not afraid of change.” Interesting. . .  ”Decisive” . . . Interesting.  Draw your own observations.

There will also be a special Readers’ Award, which will be voted for by readers of the Financial Times and FT.com. A shortlist of five companies that have shown boldness, leadership and embraced innovation in the last twelve months have been selected.  They are:

• Nintendo
• Twitter
• American Apparel
• HCL Technologies
• Santander

Read about the reason for their selection. Alternatively, you can vote for your own company by emailingboldness@ft.com

Here is a short, 3.5 minute video which explains a couple of key concepts involved in mergers and acquisitions. It is a good reminder that while we at 1-Focus point out that our primary work is in the area of mergers and acquisitions, the people that really hire us are more interested in consolidation. Hence the importance for them of integration. I know . . . “a rose by any other name . . .

This is the second time this week that the idea of using social software in M&A’s has crossed my desk. First, was a social networking tool which was used a couple years ago to aid in the merger between Adobe & Macromedia.  I took the testdrive and found it interesting. You can find it at this link:http://www.intronetworks.com/testdrive.html

The second is a rather interesting post “How Can Social Software Help Mergers And Acquisitions?”  Blogger Laurisa is a IBM Social Software Specialist, focusing on Lotus Connections and enterprise social software business value, use case scenarios, and adoption techniques.  Her post looks at these issues as she prepares to make a presentation on the subject at IBM.

I would be careful to make sure that we keep the distinctions about what these social software tools are and are not. Social Networks are not Communities but can facilitate the development of a communities of interest. Similarly, connectivity tools are not necessarily collaborative by design but again “may” be used in collaborative ventures.

I’m finding that there is a lot of confusion between the concept of social media and the concept of community. They are often used interchangeably and they are not the same thing. Social media can help foster communities but social media can be limited to allowing a conversation around content…which is *not* community.  

While I believe that this movement towards online networking both socially and for business will continue to grow, I do not know if it will help to make us more connected or in reality more isolated.  (Thus perpetuating what Faith Popcorn coined years back as cocooning.)  There is the false sense of creating meaningful relationships which I don’t think is true but I have great hope that these mediums have tremendous potential for bringing us into contact with people and ideas from around the world.

For more of the growth of social networking check out this press release from The Conference Board.

My thanks to for sharing this information from Terrill Frantz who points out as he puts it - A nice 5-minute interview video of the managing director of M&A integration for Getzler Henrich & Associates LLC. Some points Dino Mauricio makes: 

1) Cost savings may not be there 
2) Importance of softer side of integration 
3) Need a 100 day plan 
4) Expect some short term results early on for shareholders 

It takes a couple of minutes to get to the meat. The customer experience (maintaining relationships) and what happens to employees are specifics of the softer side.   Don’t underestimate the importance of the 100 day plan. That fits with one of our five critical issues – Timing.  At 1-Focus we believe that tangible benefits can be realized within the shorter term. Dino Mauricio ends his interview with revisiting the ever old issue of cultural considerations.

Consolidation in the banking industry continues at a rapid-fire pace, bringing with it an avalanche of post-merger integration challenges. The Deal newsweekly feature on Making megabanks examines how Bank of America Corp., J.P. Morgan Chase & Co. and Wells Fargo & Co. are all projecting significant synergies from their recent deals, but none have offered details on how those saving will be achieved. In this edition of Inside The Deal, Dino Mauricio, managing director of M&A integration for Getzler Henrich & Associates LLC, talks with The Deal’s Suzanne Stevens about the hurdles that lie ahead and just how long shareholders are willing to wait to see results.

Last month, The Financial Times UK had a short article called: Can the new CEO end a culture clash after a merger?  To begin there was no analysis of any cultural / DNA due diligence which would lead to the proper culture strategy but that is a discussion for another time and to be fair beyond the scope of this piece. What was particularly interesting and enlightening was the take from four perspecitves:

1. The Academic: Maintaining the illusion that there were no losers in the merger merely sustains conflict.
2. The Executive: Embrace, not avoid, the strengths and differences of your global constituents, and turn them into a competitive advantage.
3. The Consultant: The key is to describe a new culture that draws on the best of the past organisations but shows a more attractive way forward.
4. The PR: His first task will be to ensure a collaborative leadership team. They must agree the corporate “story” for the company, what it is and where it is going, and articulate this vision to staff.

In their book, Judgment: How Winning Leaders Make Great Calls  Tichy and Bennis identify the stages of the decision making process: sensing a need, getting it “framed and named,” mobilizing others, making a judgment and seeing the execution through.   Good judgment doesn’t just happen, says Noel Tichy, a business professor at the University of Michigan. “When we looked at leaders that make big decisions … it’s not a blink, it’s a process,” Tichy says. “You own it from beginning to end.”  

I confess that I have not read the book.  While not a fan of Tichy, I am a fan of Bennis.  (I find Tichy uninspiring to read and everything by Bennis of value so there is my bias.)  In this short interview below, Tichy discusses the leadership role that A.G. Lafley took in heading up the Proctor & Gamble acquisition of Gillette and the success.  I noticed that he did refer to it as an acquisition and not merger which may explain why the decision and implementation has been labelled a success BUT the integration of the employees and culture remains to have challenges.   Leaders need to take a closer look not only in their role to support implementation but to create a Culture of Engagement through systematic integration right from the start.