Cultural Due Diligence as a Proactive Strategy of Organisational Change: An Empirical Analysys

Abstract

This paper is focused on cultural diligence as a tool to handle the changes related to a merger and acquisition process. The main goal is to provide a framework to handle the whole merger process in a proactive perspective to managing changing. For a diligence to be strategic in the decision-making process, it must be related to the ability of evaluating its actual success: the identification of potential problems of culture clash and the anticipated management of the post-merger integration process define a proactive logic of change management, rather than a reactive strategy or an adjustment strategy. Cultural change should occur in all the companies involved and begin as soon as the deal is considered, rather than when diligence is completed: cultural diligence helps anticipate the demands of integration. When preliminarily considering cultural characteristics, the acquirer's executives can be prepared to articulate a cultural end state for the combined organization; decisions can be made to retain a degree of cultural autonomy in the target or to approach the work of fully assimilating the acquired culture. For the purposes, I examine the use of a professional advisor - NM Rothschild & Sons - in particular. The study is carried out by means of the behaviour analysis of the due diligence teams made up of the advisor in the framework of four cross-border merger operations, carried out in the banking sector in particular.