When you read the press today on the various alliances in the world, be they in banking, aeronautics, petroleum or other sectors, it is clear that the honeymoon is over even before the marriage begins. The real question is " can yesterday's enemies make peace and work together, rather than tearing each other apart? ". In other words, can the shareholders find their necessary returns, the personnel their motivation and the clients the quality of service they need?
Two out of three mergers fail to meet expectations because the companies do not manage to align their ways of working and, consequently, the managers do not work together. The difficulties are increased with competitors: the chances of success with an old adversary are even less likely. Having to make your enemy an ally thus requires taking specific steps.
Our work at Inter Cultural Management Associates has led us to examine the difficulties of corporate marriages after a previously adversarial relationship and to identify whether or not 'the pieces can be put back together.' There are two keys for success : first, you must analyze certain critical parameters of the past relationship. Second, you must develop a true integration strategy.

Analyzing the impact of the past relationship

Some companies have traditionally mobilized their troops with a simple vision: kill the enemy. And even if your new partners weren't really an enemy in the past, they can become one during the pre-nuptial phase. An OPE or an OPA can be perceived as quite aggressive, even vicious. The very public battle between three banks, BNP, Paribas and Société Générale or the delicate battle between Totalfina and Elf are good examples. Regardless of the final results, these battles between leaders create adversarial factions, each with its supporters. What's worse, if the uncertainly lasts too long, it can cause damage that you may not be able to overcome: loss of staff, contracts, credibility, motivation…

How can you become allied with a group that you have suspected for years of only beating you by cheating, or whose practices are illegal or unethical? Or whose technology, or products or methods you have always criticized and even scorned? Managing the transition from enemy to ally is particularly delicate if this aspect is not managed carefully.
When the image of a company is severely damaged, you must concentrate on connecting people. Only the quality of the first contacts, the efforts made in an integration process, honesty in communications, clear and perceived commitment of top management and their ability to listen and to empathize will allow you to build up enough mutual trust for people to give the new venture a chance.

Is there a common threat to both companies that makes the alliance a credible, necessary and legitimate act for survival? If so, this will help create a cease fire and will provide the first basis for communication and relations with yesterday's enemy. How could Germany have reconciled with its past enemies so quickly without the Cold War? Some companies with very strong positions in their market, like Microsoft, play this role of 'external integrator' and indirectly facilitate the success of alliances in its sector. Management and internal communications must use this dynamic created by competition to help unite people internally.

Developing an integration strategy

Some say that what happens during courtship determines what life together will be like after marriage. The first interactions should be well prepared, as it is in this initial phase that opinions, stereotypes, reputations and lasting images are formed.
Criticism, irony or disparaging comments in speeches or advertising are extremely costly when it comes time to sign on the dotted line. Ridiculing the other party is taking a major risk on the future together.
The recent pubic declaration that the new executive committee of the new petrochemical giant, resulting from the merger of two competitors, would consist of the most competent implies that all others are not. At this point, all the 'others' draw their swords and go out looking for blood. Diplomacy is not just for politicians, and many captains of industry would do well to develop theirs in order to avoid future disasters.

How many times have we heard a simple denial of the problem! " Our managers are intelligent. They will understand that it is in everyone's best interest to put aside differences and work together. " How naive to think that it is intelligence alone that comes into play in these situations. It is emotions that play a major role, people's guts and their gut reactions that can't be reasoned away. And of course dealing with emotions is not something leaders are necessarily best at. Managing emotions, however, is crucial in managing the integration process. Denying the problem is a convenient way of trying to avoid this key dimension.
To take this difficulty into account, you must start with the reality of the perceptions each side has of the other, and recognize that it won't be easy to work together: there is a modus vivendi to identify and create together. It is also key to launch common projects that will bring quick and visible added value to the collaboration. You can not expect people to suddenly appreciate their enemy, to change their values and their beliefs overnight. Rather you can more easily get them to advance on technical matters and professional issues to increase professional effectiveness.

A marriage is a celebration, even when it is arranged for diplomatic or economic purposes. You must prepare this celebration and make it a great one. The event must be equal to the damage of the past to overcome and the high hopes you have for the future if you want to stir people's hearts. This doesn't necessarily mean spending huge sums, but does imply some very visible actions that are strong, symbolic and touch people's emotions.
These actions must make up for past wounds so that people are ready for a fresh start and open to creating something new.
Peacetime can be initiated through varied symbolic gestures (hand shakes, gifts, site visits), formal and informal encounters (conventions, seminars) and the launching of some key projects… Some companies organize athletic competitions where the competing teams wear the colors of their company. One group had bought several international subsidiaries at once. The inter-subsidiary soccer tournament they organized was a heroic page in their integration history. The win by the Portuguese team over that of the headquarters greatly contributed to honoring the new arrivals…

The president of a major insurance company assured us with great pride that he had led a very successful merger. When we asked how many of the top managers stayed from the company he bought one year and a half ago, his answer was brief: " none ".
If the divisions of both companies involved are made up of women and men who for decades have earned the respect of their colleagues and team members by fighting against their now ally, the first action to take is to try to convince them and give them convincing arguments as to why this alliance is important for them. How can people in sales now tell their clients that yesterday's enemy, who was not worthy of their business, is now a competent friend on whom they can rely? Of course more recent people and teams in the organizations will take less convincing. You must quickly identify the key people, new or old, who will help bring the others around.

When you observe leaders' communication skills in periods of crisis, you can easily see those who are trained and prepared. The media attention to corporate marriages has become enormous. Communications are a lever to influence the market, a tool for managing internally, and a potentially dangerous narcissistic trap where one may, in one phrase, destroy stock value, personnel motivation or one's personal image…
Learning to communicate is key at every level of the company. Experience shows that in times of crisis, people first listen to and trust their direct manager. Front line manager buy-in is essential to the integration process.

There is no quick fix. Who can erase 15 years of intense competition in three months? Emotional adjustment and cultural change take much longer than technical and organizational change. Only a methodical accompaniment over time, adapted to the specific needs of your company, will reduce the integration cycle and allow the new entity to present itself in its best, most efficient and competitive state on the market.

Experience has made us optimistic. There is no enemy who cannot be a potential ally, even a friend. It all depends on the way, the process, the art with which leaders will or won't know how to convince people that the shared future of the two companies is more profitable than staying on their own and that there is a vital necessity to work together.

Charles Gancel, Cgancel@icmassociates.com
Elisabeth de Saint Basile, ESBasile@icmassociates.com