High Marks for HP, Compaq Merger

Merging corporate cultures is never easy. The takeaways of how HP successfully accomplished this goal in its acquisition of Compaq.

Hewlett-Packard's acquisition of Compaq was a down and dirty shareholder fight. And then the real fun began as the companies sought to merge two corporate cultures with distinctive identities into a whole with a unified vision.

By all accounts, the merger has been successful. The success provides a good map for any company needing to blend cultures after a merger or acquisition.

Focus on Understanding

HP's transition team focused on communicating the future vision to everyone. The team knew the combined company would have trouble finding success unless customers and front-line employees understood the benefits of the acquisition. To build buy-in and clarity, the merger team communicated early and often with customers, employees, partners, investors, and the media.

HP used a communications plan as the map for spreading information consistently. The plan focused on key messages, external and internal audiences, vehicles to reach target audiences, and timing. All facets were detailed up front and adapted as the process moved forward. A central communications point was responsible for establishing and maintaining consistency throughout the company.

Cascading Up, Down and Across the Organization

Cascading communications was a key element of the plan. The transition team spent the necessary time making sure executives clearly understood the synergies created by the merger. The executives then took responsibility for sharing this information throughout the company to the sales and customer service force.

A multi-layered effort of training and communications focused on the rest of the organization. The company held more than 17,000 team meetings across the world to present the new organization, roles, and responsibilities. Company leaders followed these meetings with updates shared frequently through memos, e-mails, town hall meetings, the Internet, and newsletters.

The Importance of Candor

Clear and honest communication was a priority. The company avoided secretive, arbitrary decisions and made sure employees received information quickly and frequently. The timeliness and honesty made sure energy was focused on building the new company rather than diverting it into worry and fear.

Key messages focused on a realistic assessment of the facts rather than being overly optimistic. This choice was especially critical with employees, who were concerned about their jobs.

What made this blending of cultures successful was the commitment to communication made by senior management. Everyone was able to articulate the vision, values, goals, and strategies for the new corporate culture. They also accepted responsibility for communicating all of them throughout the company using face-to-face meetings with middle managers and employees.