8 Tips for Preserving a Firm’s Culture Post-Merger

An advisory firm’s culture will change after a merger and acquisition, but Greg Friedman of Private Ocean and Brent Brodeski of Savant Capital Management suggest their M&A peers follow these steps to maximize success.

1. Recognize that success isn’t just about the money.
   Brodeski’s advice: “Make sure you 90% agree on a common vision, have aligned cultures and like each other. Life is too short to partner with people you don’t like just because a deal is accretive. This may mean you do fewer deals, but those you get done will have a higher likelihood of success and both parties will have far more fun.”

2. Assess the fit between your culture and your prospective partner’s.
   “The more cultural alignment there is at the outset, the easier it will be to maintain the culture,” said Friedman.

3. Decide on the aspects of your culture that you want to keep.
   Friedman’s recommendation: “Hold tight to the things that are most important to you and let go of the rest.”

4. Be sure you can live with your partner’s differences.
   “When people go into marriages thinking they will change the other person, it typically ends up in divorce,” Brodeski pointed out. “In contrast, if you understand and respect your partner’s differences, marriages often last and are rewarding.”

5. Do your homework but trust your intuition.
   Friedman advised, “Do a tremendous amount of due diligence on the [other firm], spend a great deal of time getting to know the people involved and listen to your little voice!”

6. Communicate.
   Said Brodeski, “We learned that however much communication we thought was enough, three times as much was better. So we now err on the side of overcommunicating.”

7. Expect change.
   “If you do a deal, things will change, which will be tough; but hopefully the change is good for you, your team and your clients,” Brodeski observed. “If so, the change will ultimately pay dividends.”

8. Keep nurturing your desired culture.
   “Culture is a living, breathing organism that needs a tremendous amount of attention and care to keep it a certain way,” Friedman said. “You can never take it for granted or let your attention wander.”

This is a sidebar to an article in the August 2015 issue of Investment Advisor called: Mergers & Aspirations: Friedman, Brodeski Share M&A Success Stories