Cultural Issues in Merger and Acquisitions

ANSWER THE FOLLOWING QUESTIONS BASED ON THE ARTICLE. NO NEED TO WRITE AN INTRODUCTORY PARAGRAPH JUST START WITH ANSWERING THE QUESTIONS. MAKE SURE THEY DONT SOUND TOO GENERAL. PLEASE REFER TO THE ARTCLE AS MUCH AS YOU CAN. ALSO, TYPE INTERCULTURAL COMMUNICATIONS IN THE WORKPLACE ON GOOGLE AND SEE IF YOU CAN VIEW CHAPTER 5 FROM THERE. THE AUTHOR OF THE BOOK ARE VARNER AND BEAMER!

According to our Deloitte white paper on mergers and acquisitions, “culture was found to be the cause of 30 percent of failed integrations” (p.1). That’s very significant given today’s incredibly fast pace at which companies are combining and becoming multicultural. Here’s what I’d like you to do:
? Pick one common high-risk point to successful integration mentioned in the Deloitte paper, e.g. decision- making, supply chain, internal brand, compensation programs, etc.
? Compare this information to what we’ve learned so far about culture from Varner and Beamer?
? Does it essentially concur or are there important differences? You may find Chpt. 5 on argumentation,
unwelcome and problem-solving messages, and channels helpful.
? Do you have any related personal experience being part of a merger or acquisition where the integration was
less than successful? Anything that could have been done differently?
? Don’t forget to include a couple specific references to our textbook to support your response.

Companies today are combining in record numbers.
Executives pursue mergers, acquisitions, and joint ventures
as a means to create value by (1) acquiring technologies,
products, and market access, (2) creating economies of
scale, and (3) establishing global brand presence. There
is an underlying belief that most markets can provide
revenues to three large suppliers; when more than three
exist the urge to merge is irresistible.
That said, the business world seems littered with
integrated companies that have lost value for shareholders.
The question that inevitably arises is: “What forces are
powerful enough to counteract the value-creating energy
of economies of scale or global market presence?” Culture
has emerged as one of the dominant barriers to effective
integrations. In one study, culture was found to be the
cause of 30 percent of failed integrations.1 Companies
with different cultures find it difficult, if not often
impossible, to make decisions quickly and correctly or to
operate effectively.
What is “culture”?
Culture consists of the long-standing, largely implicit
shared values, beliefs, and assumptions that influence
behavior, attitudes, and meaning in a company (or society).
This definition has several important implications:
Culture is implicit. People who share in a culture find
their culture challenging to recognize. The most insightful
cultural observers often are outsiders, because cultural
givens are not implicit to them.
Culture influences how people behave and how
people understand their own actions. As a result,
culturally influenced beliefs and actions feel right to
people, even while their implicit underpinnings make it
difficult for those people to understand why they act the
way they do or why other ways of acting might also be
appropriate.
Culture is resilient. Its elements are long-standing, not
a matter of fads. The resilience of culture is supported by
culture being implicit. It is difficult for people to recognize
their own culture and how it exerts an influence on them.
The staying power of culture is that it feels right to people;
new cultural values that are imposed on people seldom
replace their underlying values and beliefs in the long run.
Cultural issues in
mergers and acquisitions
Leading through transition:
Perspectives on the people side of M&A
1 Isaac Dixon, “Culture Management and Mergers and Acquisitions,” Society for Human Resource Management case study, March 2005.
The most insightful cultural observers
often are outsiders, because cultural
givens are not implicit to them.
2
What does this mean for integrating two companies?
If people acted solely on the basis of rational calculations — the model of behavior preferred by economists — mergers
would be effective — or not — based on the soundness of their economic underpinnings. But participants in mergers are
human and driven both by their shared culture and individual personalities. Cultural influences have the potential to be broad
and far reaching:
Culture affects Resulting in
Decision-making style (for example:
consensus contrasted with top-down)
• Effective integration requires rapid decision-making.
• Different decision-making styles can lead to slow decision-making,
failure to make decisions, or failure to implement decisions.
Leadership style (for example: dictatorial or
consultative, clear or diffuse)
• A shift in leadership style can generate turnover among employees
who object to the change. This is especially true for top talent, who
are usually the most mobile employees.
• Loss of top talent can quickly undermine value in an integration by
draining intellectual capital and market contacts.
Ability to change (willingness to risk new
things, compared with focus on maintaining
current state and meeting current goals)
• Unwillingness to implement new strategies.
• Unwillingness to work through the inevitable difficulties in creating a
new company.
How people work together (for example:
based on formal structure and role definitions
or based on informal relationships)
• Merged companies will create interfaces between functions that
come from each legacy company, or new functions that integrate
people from both legacy companies. If the cultural assumptions of the
legacy companies are inconsistent, then processes and handoffs may
break down with each company’s employees becoming frustrated by
their colleagues’ failure to understand or even recognize how work
should be done.
Beliefs regarding personal “success”
(for example: organizations that focus on
individual “stars,” or on teamwork, or where
people rise through connections with senior
practitioners)
• Again, these differences can lead to breakdowns in getting work
done. If people who believe they have to achieve goals as a team
integrate with people whose notion of “success” emphasizes individual
performance, the resulting situation is often characterized by
personal dislike and lack of support for getting the job done.
3
How to harness culture to promote an effective
integration
Culture usually is a soft concept; it is a set of implicit
influences that people cannot account for completely or
accurately. Premerger due diligence will ferret out things
that are measurable, with an emphasis on financial data.
Culture surveys and assessment tools can be used to
measure culture, but these can be time consuming to
complete, and the heat of deal-making usually precludes the
luxury of an extended effort to assess soft variables. Even if
a culture assessment is performed during due diligence, it is
difficult to imagine a joint venture or merger being called off
because due diligence revealed that the cultures of the two
legacy companies were incompatible.
Given that culture will seldom stop a proposed transaction,
it becomes the responsibility of the people managing
the deal to stop culture from undermining their desired
goals. The most widely used approach to managing
the cultural issues is to define a set of desirable cultural
attributes (a typical set being: customer-focused, innovative,
entrepreneurial, decisive, team-oriented, respectful of
others) and then to exhort employees to adopt these
attributes in their daily behavior. Companies are replete
with posters, screen savers, coffee mugs, and mouse pads
that remind employees of desirable attributes. This method
is not supported by many “success” stories. The attributes
are usually generic and employees struggle to bridge the
gap between broad principles that are easy to agree with
and the specific, culture-driven ways that things get done in
companies.
One of the inherent characteristics of postmerger integration
is time pressure. Many tasks have to be completed quickly.
Such an environment does not afford the time for a detailed
cultural diagnosis or a long-term culture change project with
dubious prospects of achieving desired goals. We suggest a
more focused approach, based on identifying the high-risk
points in the establishment of the integrated company
and working with employees to reduce the ways in which
culture magnifies these risks.
The major risks vary in every integration and need to be
identified on a case-by-case basis, but a list of risks that
will be encountered in most transactions can be provided
as a starting point for specific analysis. These “standard
integration risks” include:
• Establishing a shared approach to decision-making that
achieves appropriate speed and decisiveness.
• Confirming that the most value-affecting interfaces
(in the supply chain) between the two legacy companies
work effectively.
• Establishing an internal brand — the value to the
employee of being part of this newly integrated
company expressed in a way that appeals to employees
from both companies. This will vary strongly depending
on whether the integration is a “merger of equals”
or a joint venture on one hand, or the integration of
one company into another. In an unequal situation,
the acquirer’s culture and brand should be expected
to dominate and should be presented to acquired
employees in a way they will value. This is especially true
when the acquiring company in a hostile takeover wants
to retain acquired employees. In a merger of equals, the
most realistic approach is to look to the emergence of a
new culture.
• Understanding the compensation programs in each
legacy company and presenting any steps to integrate
them in a way that employees see as beneficial to their
interests.
Mixing the cultures: HP acquires Compaq
Two hallmarks of HP’s absorption of Compaq were a
strong focus on business issues and an equally strong
focus on providing an interactive forum for employees
using the Web. Interestingly, the extended proxy
fight that delayed closing the deal may have helped
integration by allowing time for product roadmaps to
be completed before the integration began. Thus an
end-state was clearly in view when large numbers of
employees started to work toward it.
The integration effort began with a two-day leadership
kickoff. Expectations and rules of engagement were
set firmly from the top down. Short deadlines were
established to achieve clearly defined synergy targets.
This forced collaboration in the interest of achieving
desired goals.
An employee portal was used to drive extensive
communication and interaction, including feedback.
On Day One alone, that portal received 50,000 hits
from employees.
4
Addressing culture when two companies integrate
A rigorous program with clearly stated objectives should
be put in place to address cultural integration. Too often,
culture is presented as a wooly and soft topic. When that
happens, executives tend to slight the issue. This can
generally be avoided by linking the cultural program to
measurable business results. There are several steps to
doing this:
1. Make culture a major component of the change
management work stream.
Often the main change management task during
integration is providing “communications.” This focus
may minimize the importance of change management,
when communication becomes reporting the decisions of
others, belatedly, rather than driving actual decisions. If
culture is recognized as a major challenge that the change
management team is responsible for, then this team
assumes an essential role in achieving integration goals.
The change team needs resources whose numbers and
caliber are consistent with enacting a critical role.
2. Identify who “owns” corporate culture and have
them report to senior management.
Choose owners from both companies to the integration
to allow for representation of all views, even in a takeover.
These “owners” typically will be senior Human Resources
or Organizational Development practitioners. This is also
an appropriate task for outside assistance, given the value
of external insights in identifying culture. To drive home
the importance of the issue, culture should be on the
agenda of regularly scheduled (monthly/biweekly) Steering
Committee meetings.
3. Insist that the cultural work focuses on the
tangible and the measurable.
The Steering Committee should reject soft, vague, and
poorly defined presentations of culture. Instead, culture
owners should be required to discuss issues that are
specific, well defined, and supported by specific examples
that can be tied to business results. This is the difference
between culture being addressed by general exhortations
to enact “teamwork” and being addressed by analysis
and interventions to increase measurable collaboration
among the members of, for example, the new company’s
merged sales force. If the culture program focuses on
whether members of the sales force are effective in
selling the products of each other’s companies and
removing the barriers to doing so, that will be a more
substantial contribution than a culture effort that creates
communications to inform the sales force about the
desirability of teamwork.
4. Consider the strengths of both existing cultures,
not just the weaknesses.
When two companies merge, the assumption is often
made that they should take the “best” of each company’s
culture and integrate them, much like creating a “Best Of”
CD from a band’s previous recordings. Would that mixing
cultures were as simple as sequencing tracks on a mix
CD! Corporate strengths are sometimes incompatible.
Solid, more mature companies often acquire start-ups as
a means of adding products to their portfolio. What they
often find is that the structural controls and well defined
processes that are a hallmark of predictable performance
for the acquirer may be impossible to mix with the less
structured ways of the start-up. A more varied integration
than a simple addition of desired qualities is required.
One means to help achieve this is to retain separate
core capabilities where possible. For example, in the
HP-Compaq merger, the merged company kept HP’s
strong Printer Division with minimal change, but integrated
its sales force along the Compaq model, which was judged
to have been more effective. Each legacy company’s
culture was allowed to dominate on a by-function basis.
Where the cultures are different, there should be an
assessment of whether the elements can be integrated.
When the integration is problematic, choices to act should
focus on the relationship between cultural assumptions
and business results. Only address those cultural issues that
are critical to the business. Make an explicit connection
between both business and personal achievements and
any changes in (cultural) assumptions that people are
asked to adopt.
5
5. Implement a decision-making process that is not
hampered by cultural differences.
Decision-making style is often deeply ingrained in a
company’s culture. However, few things have a greater
impact on integration results than the ability to make
speedy decisions. Customer and employee loyalty can
erode quickly if a company is perceived as unable to
reach decisions. Leaders of integrating companies find
themselves thrust into a situation where they have to make
decisions quickly. While varying decision-making styles
may hamper this, the differences among decision-making
styles are often less important than the difference among
these styles and the decision-making style required for an
effective integration. This is an urgent matter.
The leaders of the integration project must address this
with the support of the culture team by:
• Identifying decision-makers for each area of the
integration.
• Understanding the decision-making style of each
company both in terms of what the style is and the
assumptions, processes, and structures that support that
style. Use this as a basis for assisting decision-makers in
moving beyond their assumptions to a point where they
can act effectively.
• Communicating expectations to those decision-makers,
including the deadlines when decisions are required. The
demand for speed can be used to force changes in how
decisions are made. Specific techniques can be used to
support this, such as encouraging 80/20 decision-making
rather than complete certainty before a choice is made.
The three steps outlined above are a starting point for
culture change in the critical area of decision-making.
In the integration of HP and Compaq, leadership had to
address the tendency of engineers to base decisions on
careful analysis of large bodies of data and the cultural
assumption that a request for more data is a legitimate
reason to delay a decision. Integration teams were
introduced to the concept of “adopt and go” — a method
of limiting analysis to currently available data and options.
“Adopt and go” emphasizes action, not analysis. The term
was heard frequently during the integration, describing the
new decision-making approach that the integration teams
had embraced.
6. Build the employee brand with a view toward
how it will be understood by employees.
If retaining the employees is a goal of integration, then
an effort must be made to secure their loyalty, just as
customers’ loyalty must be reinforced. When one company
is acquiring another, then the emphasis should be on
making the acquiring company’s brand attractive, in terms
of the career opportunities, rewards, and the sense of
identity that it offers to acquired employees. When equals
are merging, it is important to find a common point that
will not be so novel as to appear alien to all employees. It
should neither install one company as dominant nor fail
to recognize that employees from the merging companies
have different expectations. In the merger of Daaichi
and Sankyo, the goal of the merger that employees were
presented with initially was to become a mid-size company
in the U.S. pharmaceuticals market. Employee surveys
showed that this was not an effective rallying cry. An
employee brand was built around “adding to the balance
of life.” That was reinforced by extensive communications,
a campaign to identify and enroll key internal opinion
leaders in the brand, and events that varied from providing
“balanced” lunches to all employees on one day to
massages at people’s chairs on another day. This brand
gained such momentum it was eventually featured in
corporate advertisements.
7. Put people with culture change knowledge
and experience on the teams that define the key
interfaces in the new organizational model.
The organizational model defines how a merged entity
will go to market and how it will integrate its back office
functions. Where there are business-critical integration
points (for example, sales force integration, hand-offs
from R&D to manufacturing or from manufacturing to
field support) and a short time available for integration, it
is important to focus on the flow of work: how objects or
information are passed from group to group or whether
information is shared effectively. The interfaces should
be designed, improved, or fixed so that they help create
business value. If employees start to act in ways that lead
to achieving desired goals, that can create trust and mutual
respect among employees who have not worked together
before. Underlying cultural beliefs should then tend to
coalesce around effective and enjoyable shared behaviors.
This reverses much typical thinking about culture change.
Rather than trying to change the culture in the hope that
behavior will follow, this approach advocates that one
should change behavior and assume that culture will adjust
accordingly.
One critical assumption underlying this approach is
that new behaviors can help achieve employee and
organizational goals and then over time “culture” will
adjust to support desired, effective behaviors. If new
behaviors that fail to achieve results are imposed on
employees, those employees will likely cling to their old
cultural beliefs all the more tenaciously.
In conclusion
Culture must be a focus in efforts to integrate companies,
because when left to itself culture will often undermine
value-creation. Efforts to address culture should be
based on the recognition that culture is both powerful
and implicit, that employees are unlikely to change their
cultural beliefs in response to exhortations to adopt new
cultural values, and that culture can be rigorously linked to
behaviors that affect business value. The focus on business
value, rather than on “soft stuff” is essential to positioning
culture in a way that business leaders will agree to support
it. By tying culture to value-creation and to identifying
and changing specific behaviors when necessary, culture
can become an effective tool for achieving postmerger
integration objectives.
Contacts
For additional articles from the Leading through
transition: Perspectives on the people side of M&A,
please visit www.deloitte.com/us/peoplesideofMA.
Frederick D. Miller
Director
Deloitte Consulting LLP
+1 212 313 1625
frmiller@deloitte.com
Eileen Fernandes
Principal
Deloitte Consulting LLP
Human Capital
+1 415 517 3317
eifernandes@deloitte.com
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edge by applying our multi-functional approach and providing services which span the deal lifecycle
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Cultural Issues in Merger and Acquisitions

ANSWER THE FOLLOWING QUESTIONS BASED ON THE ARTICLE. NO NEED TO WRITE AN INTRODUCTORY PARAGRAPH JUST START WITH ANSWERING THE QUESTIONS. MAKE SURE THEY DONT SOUND TOO GENERAL. PLEASE REFER TO THE ARTCLE AS MUCH AS YOU CAN. ALSO, TYPE INTERCULTURAL COMMUNICATIONS IN THE WORKPLACE ON GOOGLE AND SEE IF YOU CAN VIEW CHAPTER 5 FROM THERE. THE AUTHOR OF THE BOOK ARE VARNER AND BEAMER!

According to our Deloitte white paper on mergers and acquisitions, “culture was found to be the cause of 30 percent of failed integrations” (p.1). That’s very significant given today’s incredibly fast pace at which companies are combining and becoming multicultural. Here’s what I’d like you to do:
? Pick one common high-risk point to successful integration mentioned in the Deloitte paper, e.g. decision- making, supply chain, internal brand, compensation programs, etc.
? Compare this information to what we’ve learned so far about culture from Varner and Beamer?
? Does it essentially concur or are there important differences? You may find Chpt. 5 on argumentation,
unwelcome and problem-solving messages, and channels helpful.
? Do you have any related personal experience being part of a merger or acquisition where the integration was
less than successful? Anything that could have been done differently?
? Don’t forget to include a couple specific references to our textbook to support your response.

Companies today are combining in record numbers.
Executives pursue mergers, acquisitions, and joint ventures
as a means to create value by (1) acquiring technologies,
products, and market access, (2) creating economies of
scale, and (3) establishing global brand presence. There
is an underlying belief that most markets can provide
revenues to three large suppliers; when more than three
exist the urge to merge is irresistible.
That said, the business world seems littered with
integrated companies that have lost value for shareholders.
The question that inevitably arises is: “What forces are
powerful enough to counteract the value-creating energy
of economies of scale or global market presence?” Culture
has emerged as one of the dominant barriers to effective
integrations. In one study, culture was found to be the
cause of 30 percent of failed integrations.1 Companies
with different cultures find it difficult, if not often
impossible, to make decisions quickly and correctly or to
operate effectively.
What is “culture”?
Culture consists of the long-standing, largely implicit
shared values, beliefs, and assumptions that influence
behavior, attitudes, and meaning in a company (or society).
This definition has several important implications:
Culture is implicit. People who share in a culture find
their culture challenging to recognize. The most insightful
cultural observers often are outsiders, because cultural
givens are not implicit to them.
Culture influences how people behave and how
people understand their own actions. As a result,
culturally influenced beliefs and actions feel right to
people, even while their implicit underpinnings make it
difficult for those people to understand why they act the
way they do or why other ways of acting might also be
appropriate.
Culture is resilient. Its elements are long-standing, not
a matter of fads. The resilience of culture is supported by
culture being implicit. It is difficult for people to recognize
their own culture and how it exerts an influence on them.
The staying power of culture is that it feels right to people;
new cultural values that are imposed on people seldom
replace their underlying values and beliefs in the long run.
Cultural issues in
mergers and acquisitions
Leading through transition:
Perspectives on the people side of M&A
1 Isaac Dixon, “Culture Management and Mergers and Acquisitions,” Society for Human Resource Management case study, March 2005.
The most insightful cultural observers
often are outsiders, because cultural
givens are not implicit to them.
2
What does this mean for integrating two companies?
If people acted solely on the basis of rational calculations — the model of behavior preferred by economists — mergers
would be effective — or not — based on the soundness of their economic underpinnings. But participants in mergers are
human and driven both by their shared culture and individual personalities. Cultural influences have the potential to be broad
and far reaching:
Culture affects Resulting in
Decision-making style (for example:
consensus contrasted with top-down)
• Effective integration requires rapid decision-making.
• Different decision-making styles can lead to slow decision-making,
failure to make decisions, or failure to implement decisions.
Leadership style (for example: dictatorial or
consultative, clear or diffuse)
• A shift in leadership style can generate turnover among employees
who object to the change. This is especially true for top talent, who
are usually the most mobile employees.
• Loss of top talent can quickly undermine value in an integration by
draining intellectual capital and market contacts.
Ability to change (willingness to risk new
things, compared with focus on maintaining
current state and meeting current goals)
• Unwillingness to implement new strategies.
• Unwillingness to work through the inevitable difficulties in creating a
new company.
How people work together (for example:
based on formal structure and role definitions
or based on informal relationships)
• Merged companies will create interfaces between functions that
come from each legacy company, or new functions that integrate
people from both legacy companies. If the cultural assumptions of the
legacy companies are inconsistent, then processes and handoffs may
break down with each company’s employees becoming frustrated by
their colleagues’ failure to understand or even recognize how work
should be done.
Beliefs regarding personal “success”
(for example: organizations that focus on
individual “stars,” or on teamwork, or where
people rise through connections with senior
practitioners)
• Again, these differences can lead to breakdowns in getting work
done. If people who believe they have to achieve goals as a team
integrate with people whose notion of “success” emphasizes individual
performance, the resulting situation is often characterized by
personal dislike and lack of support for getting the job done.
3
How to harness culture to promote an effective
integration
Culture usually is a soft concept; it is a set of implicit
influences that people cannot account for completely or
accurately. Premerger due diligence will ferret out things
that are measurable, with an emphasis on financial data.
Culture surveys and assessment tools can be used to
measure culture, but these can be time consuming to
complete, and the heat of deal-making usually precludes the
luxury of an extended effort to assess soft variables. Even if
a culture assessment is performed during due diligence, it is
difficult to imagine a joint venture or merger being called off
because due diligence revealed that the cultures of the two
legacy companies were incompatible.
Given that culture will seldom stop a proposed transaction,
it becomes the responsibility of the people managing
the deal to stop culture from undermining their desired
goals. The most widely used approach to managing
the cultural issues is to define a set of desirable cultural
attributes (a typical set being: customer-focused, innovative,
entrepreneurial, decisive, team-oriented, respectful of
others) and then to exhort employees to adopt these
attributes in their daily behavior. Companies are replete
with posters, screen savers, coffee mugs, and mouse pads
that remind employees of desirable attributes. This method
is not supported by many “success” stories. The attributes
are usually generic and employees struggle to bridge the
gap between broad principles that are easy to agree with
and the specific, culture-driven ways that things get done in
companies.
One of the inherent characteristics of postmerger integration
is time pressure. Many tasks have to be completed quickly.
Such an environment does not afford the time for a detailed
cultural diagnosis or a long-term culture change project with
dubious prospects of achieving desired goals. We suggest a
more focused approach, based on identifying the high-risk
points in the establishment of the integrated company
and working with employees to reduce the ways in which
culture magnifies these risks.
The major risks vary in every integration and need to be
identified on a case-by-case basis, but a list of risks that
will be encountered in most transactions can be provided
as a starting point for specific analysis. These “standard
integration risks” include:
• Establishing a shared approach to decision-making that
achieves appropriate speed and decisiveness.
• Confirming that the most value-affecting interfaces
(in the supply chain) between the two legacy companies
work effectively.
• Establishing an internal brand — the value to the
employee of being part of this newly integrated
company expressed in a way that appeals to employees
from both companies. This will vary strongly depending
on whether the integration is a “merger of equals”
or a joint venture on one hand, or the integration of
one company into another. In an unequal situation,
the acquirer’s culture and brand should be expected
to dominate and should be presented to acquired
employees in a way they will value. This is especially true
when the acquiring company in a hostile takeover wants
to retain acquired employees. In a merger of equals, the
most realistic approach is to look to the emergence of a
new culture.
• Understanding the compensation programs in each
legacy company and presenting any steps to integrate
them in a way that employees see as beneficial to their
interests.
Mixing the cultures: HP acquires Compaq
Two hallmarks of HP’s absorption of Compaq were a
strong focus on business issues and an equally strong
focus on providing an interactive forum for employees
using the Web. Interestingly, the extended proxy
fight that delayed closing the deal may have helped
integration by allowing time for product roadmaps to
be completed before the integration began. Thus an
end-state was clearly in view when large numbers of
employees started to work toward it.
The integration effort began with a two-day leadership
kickoff. Expectations and rules of engagement were
set firmly from the top down. Short deadlines were
established to achieve clearly defined synergy targets.
This forced collaboration in the interest of achieving
desired goals.
An employee portal was used to drive extensive
communication and interaction, including feedback.
On Day One alone, that portal received 50,000 hits
from employees.
4
Addressing culture when two companies integrate
A rigorous program with clearly stated objectives should
be put in place to address cultural integration. Too often,
culture is presented as a wooly and soft topic. When that
happens, executives tend to slight the issue. This can
generally be avoided by linking the cultural program to
measurable business results. There are several steps to
doing this:
1. Make culture a major component of the change
management work stream.
Often the main change management task during
integration is providing “communications.” This focus
may minimize the importance of change management,
when communication becomes reporting the decisions of
others, belatedly, rather than driving actual decisions. If
culture is recognized as a major challenge that the change
management team is responsible for, then this team
assumes an essential role in achieving integration goals.
The change team needs resources whose numbers and
caliber are consistent with enacting a critical role.
2. Identify who “owns” corporate culture and have
them report to senior management.
Choose owners from both companies to the integration
to allow for representation of all views, even in a takeover.
These “owners” typically will be senior Human Resources
or Organizational Development practitioners. This is also
an appropriate task for outside assistance, given the value
of external insights in identifying culture. To drive home
the importance of the issue, culture should be on the
agenda of regularly scheduled (monthly/biweekly) Steering
Committee meetings.
3. Insist that the cultural work focuses on the
tangible and the measurable.
The Steering Committee should reject soft, vague, and
poorly defined presentations of culture. Instead, culture
owners should be required to discuss issues that are
specific, well defined, and supported by specific examples
that can be tied to business results. This is the difference
between culture being addressed by general exhortations
to enact “teamwork” and being addressed by analysis
and interventions to increase measurable collaboration
among the members of, for example, the new company’s
merged sales force. If the culture program focuses on
whether members of the sales force are effective in
selling the products of each other’s companies and
removing the barriers to doing so, that will be a more
substantial contribution than a culture effort that creates
communications to inform the sales force about the
desirability of teamwork.
4. Consider the strengths of both existing cultures,
not just the weaknesses.
When two companies merge, the assumption is often
made that they should take the “best” of each company’s
culture and integrate them, much like creating a “Best Of”
CD from a band’s previous recordings. Would that mixing
cultures were as simple as sequencing tracks on a mix
CD! Corporate strengths are sometimes incompatible.
Solid, more mature companies often acquire start-ups as
a means of adding products to their portfolio. What they
often find is that the structural controls and well defined
processes that are a hallmark of predictable performance
for the acquirer may be impossible to mix with the less
structured ways of the start-up. A more varied integration
than a simple addition of desired qualities is required.
One means to help achieve this is to retain separate
core capabilities where possible. For example, in the
HP-Compaq merger, the merged company kept HP’s
strong Printer Division with minimal change, but integrated
its sales force along the Compaq model, which was judged
to have been more effective. Each legacy company’s
culture was allowed to dominate on a by-function basis.
Where the cultures are different, there should be an
assessment of whether the elements can be integrated.
When the integration is problematic, choices to act should
focus on the relationship between cultural assumptions
and business results. Only address those cultural issues that
are critical to the business. Make an explicit connection
between both business and personal achievements and
any changes in (cultural) assumptions that people are
asked to adopt.
5
5. Implement a decision-making process that is not
hampered by cultural differences.
Decision-making style is often deeply ingrained in a
company’s culture. However, few things have a greater
impact on integration results than the ability to make
speedy decisions. Customer and employee loyalty can
erode quickly if a company is perceived as unable to
reach decisions. Leaders of integrating companies find
themselves thrust into a situation where they have to make
decisions quickly. While varying decision-making styles
may hamper this, the differences among decision-making
styles are often less important than the difference among
these styles and the decision-making style required for an
effective integration. This is an urgent matter.
The leaders of the integration project must address this
with the support of the culture team by:
• Identifying decision-makers for each area of the
integration.
• Understanding the decision-making style of each
company both in terms of what the style is and the
assumptions, processes, and structures that support that
style. Use this as a basis for assisting decision-makers in
moving beyond their assumptions to a point where they
can act effectively.
• Communicating expectations to those decision-makers,
including the deadlines when decisions are required. The
demand for speed can be used to force changes in how
decisions are made. Specific techniques can be used to
support this, such as encouraging 80/20 decision-making
rather than complete certainty before a choice is made.
The three steps outlined above are a starting point for
culture change in the critical area of decision-making.
In the integration of HP and Compaq, leadership had to
address the tendency of engineers to base decisions on
careful analysis of large bodies of data and the cultural
assumption that a request for more data is a legitimate
reason to delay a decision. Integration teams were
introduced to the concept of “adopt and go” — a method
of limiting analysis to currently available data and options.
“Adopt and go” emphasizes action, not analysis. The term
was heard frequently during the integration, describing the
new decision-making approach that the integration teams
had embraced.
6. Build the employee brand with a view toward
how it will be understood by employees.
If retaining the employees is a goal of integration, then
an effort must be made to secure their loyalty, just as
customers’ loyalty must be reinforced. When one company
is acquiring another, then the emphasis should be on
making the acquiring company’s brand attractive, in terms
of the career opportunities, rewards, and the sense of
identity that it offers to acquired employees. When equals
are merging, it is important to find a common point that
will not be so novel as to appear alien to all employees. It
should neither install one company as dominant nor fail
to recognize that employees from the merging companies
have different expectations. In the merger of Daaichi
and Sankyo, the goal of the merger that employees were
presented with initially was to become a mid-size company
in the U.S. pharmaceuticals market. Employee surveys
showed that this was not an effective rallying cry. An
employee brand was built around “adding to the balance
of life.” That was reinforced by extensive communications,
a campaign to identify and enroll key internal opinion
leaders in the brand, and events that varied from providing
“balanced” lunches to all employees on one day to
massages at people’s chairs on another day. This brand
gained such momentum it was eventually featured in
corporate advertisements.
7. Put people with culture change knowledge
and experience on the teams that define the key
interfaces in the new organizational model.
The organizational model defines how a merged entity
will go to market and how it will integrate its back office
functions. Where there are business-critical integration
points (for example, sales force integration, hand-offs
from R&D to manufacturing or from manufacturing to
field support) and a short time available for integration, it
is important to focus on the flow of work: how objects or
information are passed from group to group or whether
information is shared effectively. The interfaces should
be designed, improved, or fixed so that they help create
business value. If employees start to act in ways that lead
to achieving desired goals, that can create trust and mutual
respect among employees who have not worked together
before. Underlying cultural beliefs should then tend to
coalesce around effective and enjoyable shared behaviors.
This reverses much typical thinking about culture change.
Rather than trying to change the culture in the hope that
behavior will follow, this approach advocates that one
should change behavior and assume that culture will adjust
accordingly.
One critical assumption underlying this approach is
that new behaviors can help achieve employee and
organizational goals and then over time “culture” will
adjust to support desired, effective behaviors. If new
behaviors that fail to achieve results are imposed on
employees, those employees will likely cling to their old
cultural beliefs all the more tenaciously.
In conclusion
Culture must be a focus in efforts to integrate companies,
because when left to itself culture will often undermine
value-creation. Efforts to address culture should be
based on the recognition that culture is both powerful
and implicit, that employees are unlikely to change their
cultural beliefs in response to exhortations to adopt new
cultural values, and that culture can be rigorously linked to
behaviors that affect business value. The focus on business
value, rather than on “soft stuff” is essential to positioning
culture in a way that business leaders will agree to support
it. By tying culture to value-creation and to identifying
and changing specific behaviors when necessary, culture
can become an effective tool for achieving postmerger
integration objectives.
Contacts
For additional articles from the Leading through
transition: Perspectives on the people side of M&A,
please visit www.deloitte.com/us/peoplesideofMA.
Frederick D. Miller
Director
Deloitte Consulting LLP
+1 212 313 1625
frmiller@deloitte.com
Eileen Fernandes
Principal
Deloitte Consulting LLP
Human Capital
+1 415 517 3317
eifernandes@deloitte.com
Deloitte’s Merger & Acquisition Services professionals help clients in their efforts to gain a competitive
edge by applying our multi-functional approach and providing services which span the deal lifecycle
and include support for such activities as: M&A strategy development, target screening, due diligence,
transaction execution, integration and divestiture.
This publication contains general information only and is based on the experiences and research of Deloitte
practitioners. Deloitte is not, by means of this publication, rendering business, financial, investment, or
other professional advice or services. This publication is not a substitute for such professional advice or
services, nor should it be used as a basis for any decision or action that may affect your business. Before
making any decision or taking any action that may affect your business, you should consult a qualified
professional advisor. Deloitte, its affiliates, and related entities shall not be responsible for any loss
sustained by any person who relies on this publication.
As used in this document, “Deloitte” means Deloitte Consulting LLP, a subsidiary of Deloitte LLP.
Please see www.deloitte.com/us/about for a detailed description of the legal structure of
Deloitte LLP and its subsidiaries.
Copyright © 2009 Deloitte Development LLC, All rights reserved.
Member of Deloitte Touche Tohmatsu

Cultural Issues in Merger and Acquisitions

ANSWER THE FOLLOWING QUESTIONS BASED ON THE ARTICLE. NO NEED TO WRITE AN INTRODUCTORY PARAGRAPH JUST START WITH ANSWERING THE QUESTIONS. MAKE SURE THEY DONT SOUND TOO GENERAL. PLEASE REFER TO THE ARTCLE AS MUCH AS YOU CAN. ALSO, TYPE INTERCULTURAL COMMUNICATIONS IN THE WORKPLACE ON GOOGLE AND SEE IF YOU CAN VIEW CHAPTER 5 FROM THERE. THE AUTHOR OF THE BOOK ARE VARNER AND BEAMER!

According to our Deloitte white paper on mergers and acquisitions, “culture was found to be the cause of 30 percent of failed integrations” (p.1). That’s very significant given today’s incredibly fast pace at which companies are combining and becoming multicultural. Here’s what I’d like you to do:
? Pick one common high-risk point to successful integration mentioned in the Deloitte paper, e.g. decision- making, supply chain, internal brand, compensation programs, etc.
? Compare this information to what we’ve learned so far about culture from Varner and Beamer?
? Does it essentially concur or are there important differences? You may find Chpt. 5 on argumentation,
unwelcome and problem-solving messages, and channels helpful.
? Do you have any related personal experience being part of a merger or acquisition where the integration was
less than successful? Anything that could have been done differently?
? Don’t forget to include a couple specific references to our textbook to support your response.

Companies today are combining in record numbers.
Executives pursue mergers, acquisitions, and joint ventures
as a means to create value by (1) acquiring technologies,
products, and market access, (2) creating economies of
scale, and (3) establishing global brand presence. There
is an underlying belief that most markets can provide
revenues to three large suppliers; when more than three
exist the urge to merge is irresistible.
That said, the business world seems littered with
integrated companies that have lost value for shareholders.
The question that inevitably arises is: “What forces are
powerful enough to counteract the value-creating energy
of economies of scale or global market presence?” Culture
has emerged as one of the dominant barriers to effective
integrations. In one study, culture was found to be the
cause of 30 percent of failed integrations.1 Companies
with different cultures find it difficult, if not often
impossible, to make decisions quickly and correctly or to
operate effectively.
What is “culture”?
Culture consists of the long-standing, largely implicit
shared values, beliefs, and assumptions that influence
behavior, attitudes, and meaning in a company (or society).
This definition has several important implications:
Culture is implicit. People who share in a culture find
their culture challenging to recognize. The most insightful
cultural observers often are outsiders, because cultural
givens are not implicit to them.
Culture influences how people behave and how
people understand their own actions. As a result,
culturally influenced beliefs and actions feel right to
people, even while their implicit underpinnings make it
difficult for those people to understand why they act the
way they do or why other ways of acting might also be
appropriate.
Culture is resilient. Its elements are long-standing, not
a matter of fads. The resilience of culture is supported by
culture being implicit. It is difficult for people to recognize
their own culture and how it exerts an influence on them.
The staying power of culture is that it feels right to people;
new cultural values that are imposed on people seldom
replace their underlying values and beliefs in the long run.
Cultural issues in
mergers and acquisitions
Leading through transition:
Perspectives on the people side of M&A
1 Isaac Dixon, “Culture Management and Mergers and Acquisitions,” Society for Human Resource Management case study, March 2005.
The most insightful cultural observers
often are outsiders, because cultural
givens are not implicit to them.
2
What does this mean for integrating two companies?
If people acted solely on the basis of rational calculations — the model of behavior preferred by economists — mergers
would be effective — or not — based on the soundness of their economic underpinnings. But participants in mergers are
human and driven both by their shared culture and individual personalities. Cultural influences have the potential to be broad
and far reaching:
Culture affects Resulting in
Decision-making style (for example:
consensus contrasted with top-down)
• Effective integration requires rapid decision-making.
• Different decision-making styles can lead to slow decision-making,
failure to make decisions, or failure to implement decisions.
Leadership style (for example: dictatorial or
consultative, clear or diffuse)
• A shift in leadership style can generate turnover among employees
who object to the change. This is especially true for top talent, who
are usually the most mobile employees.
• Loss of top talent can quickly undermine value in an integration by
draining intellectual capital and market contacts.
Ability to change (willingness to risk new
things, compared with focus on maintaining
current state and meeting current goals)
• Unwillingness to implement new strategies.
• Unwillingness to work through the inevitable difficulties in creating a
new company.
How people work together (for example:
based on formal structure and role definitions
or based on informal relationships)
• Merged companies will create interfaces between functions that
come from each legacy company, or new functions that integrate
people from both legacy companies. If the cultural assumptions of the
legacy companies are inconsistent, then processes and handoffs may
break down with each company’s employees becoming frustrated by
their colleagues’ failure to understand or even recognize how work
should be done.
Beliefs regarding personal “success”
(for example: organizations that focus on
individual “stars,” or on teamwork, or where
people rise through connections with senior
practitioners)
• Again, these differences can lead to breakdowns in getting work
done. If people who believe they have to achieve goals as a team
integrate with people whose notion of “success” emphasizes individual
performance, the resulting situation is often characterized by
personal dislike and lack of support for getting the job done.
3
How to harness culture to promote an effective
integration
Culture usually is a soft concept; it is a set of implicit
influences that people cannot account for completely or
accurately. Premerger due diligence will ferret out things
that are measurable, with an emphasis on financial data.
Culture surveys and assessment tools can be used to
measure culture, but these can be time consuming to
complete, and the heat of deal-making usually precludes the
luxury of an extended effort to assess soft variables. Even if
a culture assessment is performed during due diligence, it is
difficult to imagine a joint venture or merger being called off
because due diligence revealed that the cultures of the two
legacy companies were incompatible.
Given that culture will seldom stop a proposed transaction,
it becomes the responsibility of the people managing
the deal to stop culture from undermining their desired
goals. The most widely used approach to managing
the cultural issues is to define a set of desirable cultural
attributes (a typical set being: customer-focused, innovative,
entrepreneurial, decisive, team-oriented, respectful of
others) and then to exhort employees to adopt these
attributes in their daily behavior. Companies are replete
with posters, screen savers, coffee mugs, and mouse pads
that remind employees of desirable attributes. This method
is not supported by many “success” stories. The attributes
are usually generic and employees struggle to bridge the
gap between broad principles that are easy to agree with
and the specific, culture-driven ways that things get done in
companies.
One of the inherent characteristics of postmerger integration
is time pressure. Many tasks have to be completed quickly.
Such an environment does not afford the time for a detailed
cultural diagnosis or a long-term culture change project with
dubious prospects of achieving desired goals. We suggest a
more focused approach, based on identifying the high-risk
points in the establishment of the integrated company
and working with employees to reduce the ways in which
culture magnifies these risks.
The major risks vary in every integration and need to be
identified on a case-by-case basis, but a list of risks that
will be encountered in most transactions can be provided
as a starting point for specific analysis. These “standard
integration risks” include:
• Establishing a shared approach to decision-making that
achieves appropriate speed and decisiveness.
• Confirming that the most value-affecting interfaces
(in the supply chain) between the two legacy companies
work effectively.
• Establishing an internal brand — the value to the
employee of being part of this newly integrated
company expressed in a way that appeals to employees
from both companies. This will vary strongly depending
on whether the integration is a “merger of equals”
or a joint venture on one hand, or the integration of
one company into another. In an unequal situation,
the acquirer’s culture and brand should be expected
to dominate and should be presented to acquired
employees in a way they will value. This is especially true
when the acquiring company in a hostile takeover wants
to retain acquired employees. In a merger of equals, the
most realistic approach is to look to the emergence of a
new culture.
• Understanding the compensation programs in each
legacy company and presenting any steps to integrate
them in a way that employees see as beneficial to their
interests.
Mixing the cultures: HP acquires Compaq
Two hallmarks of HP’s absorption of Compaq were a
strong focus on business issues and an equally strong
focus on providing an interactive forum for employees
using the Web. Interestingly, the extended proxy
fight that delayed closing the deal may have helped
integration by allowing time for product roadmaps to
be completed before the integration began. Thus an
end-state was clearly in view when large numbers of
employees started to work toward it.
The integration effort began with a two-day leadership
kickoff. Expectations and rules of engagement were
set firmly from the top down. Short deadlines were
established to achieve clearly defined synergy targets.
This forced collaboration in the interest of achieving
desired goals.
An employee portal was used to drive extensive
communication and interaction, including feedback.
On Day One alone, that portal received 50,000 hits
from employees.
4
Addressing culture when two companies integrate
A rigorous program with clearly stated objectives should
be put in place to address cultural integration. Too often,
culture is presented as a wooly and soft topic. When that
happens, executives tend to slight the issue. This can
generally be avoided by linking the cultural program to
measurable business results. There are several steps to
doing this:
1. Make culture a major component of the change
management work stream.
Often the main change management task during
integration is providing “communications.” This focus
may minimize the importance of change management,
when communication becomes reporting the decisions of
others, belatedly, rather than driving actual decisions. If
culture is recognized as a major challenge that the change
management team is responsible for, then this team
assumes an essential role in achieving integration goals.
The change team needs resources whose numbers and
caliber are consistent with enacting a critical role.
2. Identify who “owns” corporate culture and have
them report to senior management.
Choose owners from both companies to the integration
to allow for representation of all views, even in a takeover.
These “owners” typically will be senior Human Resources
or Organizational Development practitioners. This is also
an appropriate task for outside assistance, given the value
of external insights in identifying culture. To drive home
the importance of the issue, culture should be on the
agenda of regularly scheduled (monthly/biweekly) Steering
Committee meetings.
3. Insist that the cultural work focuses on the
tangible and the measurable.
The Steering Committee should reject soft, vague, and
poorly defined presentations of culture. Instead, culture
owners should be required to discuss issues that are
specific, well defined, and supported by specific examples
that can be tied to business results. This is the difference
between culture being addressed by general exhortations
to enact “teamwork” and being addressed by analysis
and interventions to increase measurable collaboration
among the members of, for example, the new company’s
merged sales force. If the culture program focuses on
whether members of the sales force are effective in
selling the products of each other’s companies and
removing the barriers to doing so, that will be a more
substantial contribution than a culture effort that creates
communications to inform the sales force about the
desirability of teamwork.
4. Consider the strengths of both existing cultures,
not just the weaknesses.
When two companies merge, the assumption is often
made that they should take the “best” of each company’s
culture and integrate them, much like creating a “Best Of”
CD from a band’s previous recordings. Would that mixing
cultures were as simple as sequencing tracks on a mix
CD! Corporate strengths are sometimes incompatible.
Solid, more mature companies often acquire start-ups as
a means of adding products to their portfolio. What they
often find is that the structural controls and well defined
processes that are a hallmark of predictable performance
for the acquirer may be impossible to mix with the less
structured ways of the start-up. A more varied integration
than a simple addition of desired qualities is required.
One means to help achieve this is to retain separate
core capabilities where possible. For example, in the
HP-Compaq merger, the merged company kept HP’s
strong Printer Division with minimal change, but integrated
its sales force along the Compaq model, which was judged
to have been more effective. Each legacy company’s
culture was allowed to dominate on a by-function basis.
Where the cultures are different, there should be an
assessment of whether the elements can be integrated.
When the integration is problematic, choices to act should
focus on the relationship between cultural assumptions
and business results. Only address those cultural issues that
are critical to the business. Make an explicit connection
between both business and personal achievements and
any changes in (cultural) assumptions that people are
asked to adopt.
5
5. Implement a decision-making process that is not
hampered by cultural differences.
Decision-making style is often deeply ingrained in a
company’s culture. However, few things have a greater
impact on integration results than the ability to make
speedy decisions. Customer and employee loyalty can
erode quickly if a company is perceived as unable to
reach decisions. Leaders of integrating companies find
themselves thrust into a situation where they have to make
decisions quickly. While varying decision-making styles
may hamper this, the differences among decision-making
styles are often less important than the difference among
these styles and the decision-making style required for an
effective integration. This is an urgent matter.
The leaders of the integration project must address this
with the support of the culture team by:
• Identifying decision-makers for each area of the
integration.
• Understanding the decision-making style of each
company both in terms of what the style is and the
assumptions, processes, and structures that support that
style. Use this as a basis for assisting decision-makers in
moving beyond their assumptions to a point where they
can act effectively.
• Communicating expectations to those decision-makers,
including the deadlines when decisions are required. The
demand for speed can be used to force changes in how
decisions are made. Specific techniques can be used to
support this, such as encouraging 80/20 decision-making
rather than complete certainty before a choice is made.
The three steps outlined above are a starting point for
culture change in the critical area of decision-making.
In the integration of HP and Compaq, leadership had to
address the tendency of engineers to base decisions on
careful analysis of large bodies of data and the cultural
assumption that a request for more data is a legitimate
reason to delay a decision. Integration teams were
introduced to the concept of “adopt and go” — a method
of limiting analysis to currently available data and options.
“Adopt and go” emphasizes action, not analysis. The term
was heard frequently during the integration, describing the
new decision-making approach that the integration teams
had embraced.
6. Build the employee brand with a view toward
how it will be understood by employees.
If retaining the employees is a goal of integration, then
an effort must be made to secure their loyalty, just as
customers’ loyalty must be reinforced. When one company
is acquiring another, then the emphasis should be on
making the acquiring company’s brand attractive, in terms
of the career opportunities, rewards, and the sense of
identity that it offers to acquired employees. When equals
are merging, it is important to find a common point that
will not be so novel as to appear alien to all employees. It
should neither install one company as dominant nor fail
to recognize that employees from the merging companies
have different expectations. In the merger of Daaichi
and Sankyo, the goal of the merger that employees were
presented with initially was to become a mid-size company
in the U.S. pharmaceuticals market. Employee surveys
showed that this was not an effective rallying cry. An
employee brand was built around “adding to the balance
of life.” That was reinforced by extensive communications,
a campaign to identify and enroll key internal opinion
leaders in the brand, and events that varied from providing
“balanced” lunches to all employees on one day to
massages at people’s chairs on another day. This brand
gained such momentum it was eventually featured in
corporate advertisements.
7. Put people with culture change knowledge
and experience on the teams that define the key
interfaces in the new organizational model.
The organizational model defines how a merged entity
will go to market and how it will integrate its back office
functions. Where there are business-critical integration
points (for example, sales force integration, hand-offs
from R&D to manufacturing or from manufacturing to
field support) and a short time available for integration, it
is important to focus on the flow of work: how objects or
information are passed from group to group or whether
information is shared effectively. The interfaces should
be designed, improved, or fixed so that they help create
business value. If employees start to act in ways that lead
to achieving desired goals, that can create trust and mutual
respect among employees who have not worked together
before. Underlying cultural beliefs should then tend to
coalesce around effective and enjoyable shared behaviors.
This reverses much typical thinking about culture change.
Rather than trying to change the culture in the hope that
behavior will follow, this approach advocates that one
should change behavior and assume that culture will adjust
accordingly.
One critical assumption underlying this approach is
that new behaviors can help achieve employee and
organizational goals and then over time “culture” will
adjust to support desired, effective behaviors. If new
behaviors that fail to achieve results are imposed on
employees, those employees will likely cling to their old
cultural beliefs all the more tenaciously.
In conclusion
Culture must be a focus in efforts to integrate companies,
because when left to itself culture will often undermine
value-creation. Efforts to address culture should be
based on the recognition that culture is both powerful
and implicit, that employees are unlikely to change their
cultural beliefs in response to exhortations to adopt new
cultural values, and that culture can be rigorously linked to
behaviors that affect business value. The focus on business
value, rather than on “soft stuff” is essential to positioning
culture in a way that business leaders will agree to support
it. By tying culture to value-creation and to identifying
and changing specific behaviors when necessary, culture
can become an effective tool for achieving postmerger
integration objectives.
Contacts
For additional articles from the Leading through
transition: Perspectives on the people side of M&A,
please visit www.deloitte.com/us/peoplesideofMA.
Frederick D. Miller
Director
Deloitte Consulting LLP
+1 212 313 1625
frmiller@deloitte.com
Eileen Fernandes
Principal
Deloitte Consulting LLP
Human Capital
+1 415 517 3317
eifernandes@deloitte.com
Deloitte’s Merger & Acquisition Services professionals help clients in their efforts to gain a competitive
edge by applying our multi-functional approach and providing services which span the deal lifecycle
and include support for such activities as: M&A strategy development, target screening, due diligence,
transaction execution, integration and divestiture.
This publication contains general information only and is based on the experiences and research of Deloitte
practitioners. Deloitte is not, by means of this publication, rendering business, financial, investment, or
other professional advice or services. This publication is not a substitute for such professional advice or
services, nor should it be used as a basis for any decision or action that may affect your business. Before
making any decision or taking any action that may affect your business, you should consult a qualified
professional advisor. Deloitte, its affiliates, and related entities shall not be responsible for any loss
sustained by any person who relies on this publication.
As used in this document, “Deloitte” means Deloitte Consulting LLP, a subsidiary of Deloitte LLP.
Please see www.deloitte.com/us/about for a detailed description of the legal structure of
Deloitte LLP and its subsidiaries.
Copyright © 2009 Deloitte Development LLC, All rights reserved.
Member of Deloitte Touche Tohmatsu