Cultural factors key for successful mergers

It’s no secret that one of the most prevalent trends in the health care sector is the growing frequency of hospital mergers. Smaller firms are combining to form more effective, competitive organizations. As this pattern continues, care providers face even greater pressure to follow suit and improve their capabilities and service offerings.

There is nothing inherently successful or simple about hospital mergers. Examples abound of failed partnerships, takeovers, and integration efforts. And of all the reasons hospital mergers prove problematic, the most significant are cultural differences, as Becker’s Hospital Review recently highlighted. Cultural differences can have a major, negative impact if not addressed in the appropriate fashion. To that end, third-party assistance from a trusted expert in the field may prove essential.

Cultural conundrums

The source highlighted a number of factors that can undermine health care mergers, including timing and finances. However, cultural considerations may be the most difficult to see coming, and therefore the most likely to cause problems down the road.

“No partnership, affiliation or merger will succeed if the corporate cultures are incompatible,” Victoria Poindexter, principal at a strategic advisory and investment banking firm, told the news source.

“Numerous mergers have been canceled at relatively late stages due explicitly to cultural discrepancies.”

The source pointed out several examples of mergers that were canceled at relatively late stages due explicitly to cultural discrepancies.

These cultural issues can take different forms. A typical example, according to Becker’s Hospital Review, is a dispute regarding the services the post-merger health care provider will offer.

However, cultural problems can also be more process-based, as employees from the two organizations may have very different day-to-day routines. Forcing one to conform to the other will inevitably create tension and may undermine the value of the merger as a whole.

Making culture work

In some cases, inherent cultural differences will be so extreme that a proposed merger simply should not occur, as the source noted. Usually, though, these tensions can be overcome with the help of a third-party IT service provider, such as Aptris.

At Aptris, we have the experience and expertise needed to evaluate these differences and develop a tested framework that creates a smooth transition to new, improved processes throughout the new health care entity. Aptris can provide leadership training and help guide implementation post-merger, further ensuring a successful unification.