HR Management & Compliance

Senior VP of HR at Smucker Discusses Cultural Considerations During Mergers and Acquisitions

When an organization is involved in a merger or an acquisition, the entire situation can be distressing for everyone. Suspicions run high in both organizations, and even the best-running company culture can run aground during those difficult times. I recently spoke with Jill Penrose, Senior Vice President of Human Resources at The J.M. Smucker Company, to discuss how HR should approach company culture during this type of upheaval.

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Penrose came to work for Smucker after working as a consultant with the company during an integration. It was there that she met Tim and Richard Smucker. They were in Orville, Ohio, addressing a group of employees who were part of an acquisition. She says, “I was struck, and I’ll always remember” how they spoke with “sincerity and authenticity” about the realities of an integration between two companies located in different states. The human touch to handling such integrations that she saw there might be the key to helping an integration succeed from a company culture standpoint.

Nobody’s Perfect

When discussing the multiple mergers and acquisitions at Smucker, Penrose had one thing she wanted to make clear: “we are not perfect, but we are always striving to do better and do more for our people.” When embarking on an integration, it’s important to note that you, too, are not going to be perfect.

For Penrose, at least, her experiences have always been educational. For example, she says, “we used to talk about preserving our culture. But we’ve intentionally transitioned our language to talk about evolving it because we think that allows room for both what we want to hold onto as well as what we want to take on and learn and allows us to be stronger as a company going forward.” The lesson is to be flexible in your approach to adjusting and redefining your company culture during an integration and be prepared to learn from what works as well as what does not.

Company Culture Transcends Values

Sometimes organizations can conflate values and company culture. For example, an organization might extol the virtue of innovation. There are many approaches to being innovative, and a company’s culture is defined by their approach. However, if an organization’s culture is defined by values alone, without consideration for the approach to achieving those values, that culture can be set adrift. Consequently, two organizations might give the same importance to the same virtues but have two very different approaches.

Penrose cautions that when organizations undergo an integration, if you speak only in the language of values, “you may be left with an impression that you are more similar than you really are.” And that false sense of understanding can have real repercussions, says Penrose, when “the way people experience working” at an organization “is entirely different.” Because there are many ways to achieve the same results, understanding those differences between two organizations before an integration is paramount to its success.

Communication Is Key

When it comes to nurturing suspicious employees before, during, or after an integration, it’s important to communicate as early and as clearly as possible to everyone involved in both companies.

An uncomfortable truth about integrations is that some employees will be let go, and others will choose to leave. That uncertainty can be very challenging for everyone, from the employees that don’t know what will happen next to the organizations that are trying to plan the next stages. Smucker approaches this uncertainty head-on, by taking the time to sit down with every employee following an acquisition. “We feel that’s a demonstration of respect to get to know them as a person,” says Penrose.

Because uncertainty is the biggest challenge for any integration, Penrose says you should be transparent and let people know that you don’t have all the answers but that you will make sure employees get the information they need. The second half of that, she says, is critical: “you have to meet that commitment. If you tell employees that they are going to know what their new benefits are in 60 days, you need to meet that commitment.” That level of communication combined with the follow-through “builds trust by demonstrating we understand what is on your mind and we care about you,” she says.

Moreover, don’t forget to communicate with the employees at the organization doing the acquiring. Penrose says that Smucker “makes sure we spend as much time with our own employees as those that are being acquired. I think sometimes there is a tendency to be so focused on the employees that you are acquiring—wanting to tell your story and help them feel that they are cared about and alleviate their uncertainty—that there is a risk that you overlook the uncertainty that your existing employees have in terms of what the acquisition means to them.” Nurturing both parties during an acquisition can be very important to preserving the health of the organization moving forward.