A Critical Examination of the Merger of a Retail Bank and a Building Society from a Cultural Management Perspective.

This management project critically examines the merger of a retail bank with a building society from a cultural management perspective. The project looks at the importance of the cultural fit between the parties and reviews their approach to cultural change. The impact on the employees is assessed and informs a discussion as to the optimum process and activities required to bring about a positive outcome. It will be concluded from the literature review that culture is the very essence of an organisation. Organisational culture is fragmented, with some organisationwide values and behaviours that can be used to generate commitment and focus; which in turn can improve organisational performance. Cultural compatibility is asserted to be a critical pre-requisite to a merger and the activity of culture management is argued to be a critical success factor in the execution of a merger. Staff surveys ranging from 2007 to 2010 have been reviewed and a number of frameworks and models from the literature are used to assess cultural compatibility. The survey findings are analysed to reveal employees that understand and are supportive of organisational direction; are immensely proud of the organization and who support the espoused organizational values. They are however more stressed after the merger than at the time of the merger and are suffering reduced team and individual morale. The organisations are deemed to be very compatible and the merger process to have been executed reasonably well. Actions are recommended to minimize the adverse employee impacts including: more visible and active leadership; changing the constitution and location of the integration team; accelerating some of the ‗hard‘ merger decisions to reduce uncertainty and anxiety and taking targeted action in response to the survey to address stress levels and the issue of increasing bureaucracy. Completion of these activities would further enhance the likelihood of a positive merger outcome