Being cognizant of key strengths and development areas can raise awareness, facilitate conversations and lead the way for appropriate interventions. Viewing the two companies through this lens can flag issues and build upon the ‘new’ entity in certain ways.  Each company will have a different profile and a unique plan of action.  However, below we consider a number of more critical areas, largely driven by the leadership team, which can help provide a smoother journey for GCC chemical companies.

• Clarity surrounding the new company: Clarity when creating the ‘new’ organization is key; the top team should be clear on their own roles and aligned to the new company’s goals. In effect, this requires creating a new company at the top. In an M&A environment, this can be the most difficult initial leadership challenge, considering this needs to be done with relative speed.
• Customer first mentality: Stakeholders such as customers tend to be relatively neglected in a merger environment. There is a common view that they should be protected as much as possible.  This ‘sheltering’, in most cases, does not work well.  During uncertain times, only a small number of companies see the opportunity to go beyond communications alone and energize key external relationships.  Focusing on creating a customer first mentality throughout the organization will be vital during this part of the journey.
• Communication and the corporate story: Factors such as energizing leadership and ownership, can in part help us convey certain messages during these uncertain times, such as through communicating the corporate story. Building a strong corporate story is extremely important in the context of chemical companies. Communication of the corporate story prior to the merger announcement enables stakeholders to interpret the merger themselves.  It should be easy to understand, frequently repeated, and able to drive people into action.  Leaders should provide timely communication at the various stages along with the ability to remain transparent and consistent.  Furthermore, openness to challenge, feedback and debate, will be even more important during this period of uncertainty.
• Agility and focused learning: Agility plays a large role when we consider merger environments. Such that, the ability to learn quickly to avoid repeating the same mistakes with a focus on continuous improvement cannot be underestimated. Learning must be taken as a personal responsibility and should take place in the top team early on.  This combined with the ability to adapt to changing circumstances and recover quickly from setbacks is a powerful combination within the context of a merger environment.  Understanding the current climate and where certain areas might be highlighted early on can help remove the unknown, particularly during these already uncertain times.

Conclusions

With the flurry of M&A activity in recent years in the chemical industry, the key is to really delve into the organizations at hand as early as possible, readily assessing their similarities and differences. Organizational frameworks can in part help with this. Driving certain leadership behaviors and in particular; creating some level of clarity, a customer first mentality, clear communication and fostering an agile environment with focused learning can serve as a strong foundation. Culture shaping can also play a critical component in merger success.  In instances where organizations have gone through multi integration programs previously, with a mix of organizational cultures that perhaps have been neglected, this maybe even more critical.