How to Train Employees After a Merger in Nordic countries

Mar 21, 2024

Mergers and acquisitions (M&As) can change the trajectory of the two involved companies, but it comes with an inherent cost and risk with regards to employees and leaders across the companies.

When two companies merge, they bring together not just their assets and products but also their people and cultures. In fact, according to a report from Mercer, 30% of deals fail to ever achieve expected financial returns and 43% of participants have experienced delayed close, no close or an impact on purchasing price due to cultural issues.

This is just as true in the Nordic countries, such as Finland, Sweden, Norway, and Denmark, where a strong emphasis on collaboration, equality, and work-life balance can significantly impact the outcome of a merger and how employees adapt to the next stage in a company’s evolution.

For executives leading this transition, understanding and addressing these cultural nuances is essential. To navigate cultural changes and create training strategies for employees, particularly for companies based in Nordic countries, who we at Datafisher aim to serve.


Challenges with Integrating Company Cultures in M&As

Whether a company from Sweden or Finland and regardless of the industry, likely will face some significant cultural challenges when facing an upcoming M&A. Beyond the compliance checks that companies will need to go through, the cultural differences and getting the two companies in sync may be the biggest issue following a deal. 

Sweden’s “lagom” ethos (just the right amount) fosters a more reserved work environment, where consensus-building and humility are prized. In contrast to Sweden, Finland’s “sisu” ethos (determination) encourages a more assertive and resilient approach to work.

Companies from Nordic countries are also known for their strong emphasis on work-life balance. Employees may resist changes that disrupt this balance, such as increased work hours or changes in work culture. Along with work-life balance and communication styles, many companies differ in their decision making processes, such as collaborative decision-making versus top-down decisions. 

But while corporate cultures across these countries are differentiated, the companies within each country are equally as different too. No two company cultures in one country are the same.


Steps to Develop Training Programs After a Merger

How does a company train employees after a merger goes through? What are the best practices to put in place? What are examples of successful M&As with regards to company culture? 

Companies should focus on creating a culture of open communication and collaboration. This can be achieved through team-building exercises, cross-departmental projects, and regular feedback sessions.

To effectively train employees after a merger in the Nordic countries, companies should tailor their training programs to reflect these cultural differences in each company. Here are several steps that each company should go through:

1. Assess the Cultural Landscape

Conducting a thorough assessment of cultural differences is essential. In the case of Disney’s acquisition of Pixar in 2006 for $7.4 billion, Disney had to adapt its corporate culture to embrace Pixar’s more creative and risk-taking culture. This adaptation was crucial for the success of the merger, as it allowed both companies to work together effectively.

Disney recognized the need to preserve Pixar’s unique creative culture while integrating it into its own. By conducting a thorough cultural assessment, Disney was able to identify key cultural differences and develop strategies to bridge the gap.


2. Develop a Customized Training Program

Once cultural differences are identified, companies should develop a training program that addresses these differences. In the case of Facebook’s purchase of Instagram for $1 billion, Facebook implemented a training program to help Instagram employees understand Facebook’s culture of data-driven decision-making. This program helped integrate Instagram employees into Facebook’s culture seamlessly.


3. Cultural Sensitivity Training

Providing employees with insights into cultural norms and values is crucial to the next stage of a company. This can be done through comprehensive training videos and courses. However, in the merger between AOL and Time Warner in 2000, cultural sensitivity training was lacking. AOL’s more informal and entrepreneurial culture clashed with Time Warner’s more traditional and hierarchical culture, leading to tensions and resistance to change. This led to clashes between employees from both companies and contributed to the failure of the merger.


4. Leadership Development

Leaders for both companies must recognize and develop leadership qualities in employees from both companies. But most importantly, company leadership needs to talk the talk and walk the walk. According to the same study from Mercer, 61% of respondents say that how leaders behave (not just what they say, but what they do) is the number one component of organizational culture. 

In the merger between Nissan and Renault in 1999, both companies focused on developing leaders who could bridge the gap between Japanese and French cultures. Both companies recognized the importance of developing leaders who could effectively manage cultural differences. This focus on leadership development contributed to the success of the merger, leading to increased profitability and market share for both companies.


5. Communication Skills

Emphasizing clear and open communication is key. In the merger between HP and Compaq in 2002, poor communication led to confusion and resistance among employees. HP’s management failed to effectively communicate the strategic rationale behind the merger, leading to uncertainty and resistance among employees. This lack of communication significantly impacted the success of the merger.


6. Provide Ongoing Support

Offering ongoing support and resources is important for employee integration. In the merger between Exxon and Mobil in 1999 in a deal valued at $81 billion, ongoing support was provided to help employees adjust to the new culture. Employees were provided with resources to help them adjust to the new culture, leading to a smooth integration process and overall success.


How to get help training employees after a Merger or Acquisition

Cultural challenges and how a company solves these issues are a significant factor in the future success of M&As. By being aware of these challenges and implementing strategies to overcome them, including effective employee training plans, companies can maximize the potential of their merger and ensure a greater chance for success.

Book a demo today and we can show how Datafisher can use our Ethics & Compliance Training to help you smoothly transition your company to its next chapter.