How to Balance Culture During an Integration

Culture in M&A

I've witnessed successful companies immediately imposing their culture on the acquired business. From our perspective, in an acquisition, we truly believe that the greatest asset is the people, not the products, IP, or locations–it's the people, their knowledge, abilities, and what they have built as a business. 

When we merge or acquire great businesses, our goal is for those people to join us and become an additional resource for our own business. So, the first thing we look for is a culture that aligns with ours.

Let me give you an example with Continental. We have our principles of conduct and action, which form the foundation of how we behave in tech: trust, empowerment, and collaboration. They had something called the Bison way, with a bison as their logo.

When we compared the components of the Bison way, which included transparency, communication, and collaboration, with our own principles of conduct and action, and trust, empowerment, and collaboration, I presented both slides side by side during our initial meeting with the teams after the acquisition.

We were basically coming from the same DNA. If you take a look at what's important to how you behave in your business, we have the exact same principle. So, we started with a point of trust going into it. 

The first part is their management style, that’s one of the cultural aspects. 

• the way they behave is aligned with how we do. 
• They are competitive. 
• They want to grow. 

That’s some of that aspect of growth and energy that we look from the culture side. If you do that correctly, you get a much better fit between the companies. That's the first thing I'd say about culture. Having one that fits and understanding where the differences are is critical going into it.

For me, a big gaining process on acquisition of the culture is way, way far away. Then you really have to understand whether you have the time, energy, and the ability to merge them into a proper homogenized culture.

The second part of it is respecting the culture. When you acquire a company, you're acquiring its people, which is the greatest asset. You're also acquiring their relationships with customers and their know-how within the business. 

They will do things better than you will, and for some people in your organization and some people in their organization, it will be very hard to accept that. It's hard to accept as the acquiring company that the company you bought or some folks in the organization is going to bring in some manufacturing technique or manufacturing software or product or productivity aspect that's better than yours. 

So, you need to go into it with this concept that we're here to learn from each other and take the best practices. It’s about making one plus one equal three. And that is leaning on that culture of trust, empowerment, and collaboration, making sure you're really being transparent and open to communication.

I'll give you one more small story about it. When we acquired Continental, we merged our Gypsum businesses together. 

• The leader of that Gypsum business was the former leader of Continental. 
• The head of the sales of that gypsum business was a former head of sales for Continental.
• The head of manufacturing was the head of manufacturing for Continental
• The purchasing person was our purchasing person.
• The finance person was our finance person. 
• The HR person was our HR person at a high level, and R&D.

My point is, we actually probably took more of them into our business than we pushed into their business in that acquisition. Although it was an acquisition, it was a merger of equals. The learnings that our team took from their key leaders in their position and the learnings they took from our key leaders in the positions that they were in, built a fantastic team that was much stronger than if we acquired them and just brought them into our organization and kept our same leadership.

It was not easy for all of our team to accept that. When you're in a competitive situation and you acquire someone in your same area, you want to show them that you've taken over and you've got this great winning attitude. But it worked out great. If you ask any of the team right now, they would say that it was really the key to success of that integration.

Acquiring a competitor 

The cultures matched, so the communication styles were the same. It was about picking the right people, which is what I find crucial when you move people around an organization. If you pick the right people that the team respects and sees why they have the position, the respect eventually comes.

When people became unemotive about it and stepped back, they realized this was the leadership team of the new combined business. There were no weak links. There's no way someone could say that was the wrong or right choice. The members of our team that held certain positions in those roles were fully supportive of the merger, and we made sure they had good places to land at the back end.

They were involved in the merger of the two businesses. Our head of sales, for instance, helped the other head of sales succeed with a new team the following year, but it was a bit of a culture shock for both businesses. But I would say that one of the key factors contributing to our success was placing the right people in the right positions.

To give you one more point of context, this acquisition closed February 4th, 2020. We had two live meetings before COVID locked down the East coast. And so the vast majority of the integration was done in COVID lockdown, adding even another level of complexity to it.

Team Alignment

You have to be completely transparent, so you explain exactly why the decisions are made and what you're hoping to get out of it. Before you pick the right teams, you stand shoulder to shoulder with those teams and you speak with the same voice. 

For example, Jay Bachman, who was leading Continental, and I would jointly address various meetings, delivering the same message. Not because we coordinated it, but because we shared the same beliefs. The senior leaders in our organization, including those who held similar positions or were peers, were fully supportive and actively engaged throughout the process.

When we make an acquisition, we are making a very strong commitment to our mother company on being successful. My commitment in this is always to make sure that when we make an acquisition:

• we're paying the right amount of money for it
• we're getting good value
• we deliver what we said we would deliver
• we deliver the synergies and everything else.

To do that, you've got to put the best team in place. Based on my extensive experience in restructuring and managing businesses, I firmly believe that when you choose the right leaders and build the right teams, emotions may arise, but people ultimately recognize the merit of the choices made. They see that Jay is the right leader, and Bruce is the right manufacturing leader, and they willingly follow their guidance.

We’re very transparent about the strategy. When we do a deal, like any of the past deals we've done in the last five years, my entire leadership team is involved, even if it doesn't reside in one of their businesses. But not in the deal, because sometimes they're public company deals, so they don't know when we're doing deals. But they’re aware about where we want to grow strategically, how we want to grow, what kind of things we want to look at. 

Deep in the organization, how we're trying to grow and what we're trying to do in North America is well understood. We're very transparent on what works, what doesn't work, and when we make a mistake. And I make plenty of mistakes, trust me. Sometimes I start my town hall meetings with the things that I've done wrong in the last six months and that I'm trying to work on, and people there are there to support you then.

Understanding culture

I get most of my understanding of the culture either from industry knowledge, or one-to-one discussions as you're doing management presentations, or plant doors. Normally, the deal you have at some point of day one or two-day management presentation session where you're with the senior leaders of the other company, how that dialogue goes, how information is presented, how questions are answered, and the back and forth that takes place in those conversations. 

From my perspective, we don't normally close an acquisition without going and visiting, if not all, the major sites. This is because you're buying some physical assets as well, so you want to go see whether the plant and plaque of Florida is, as you expect it to be. In that case, you get to walk the floor with the senior leaders. Depending on where you are in the process, you often get to interact with some folks that are running the machinery, supervisors, and engineers. Just how that interaction is, how the dialogue goes between people, the level of knowledge the plant manager has of the people, is a way to get a feel for how that culture fits in.

Does it feel the same way as me walking a plant in our area? That's the interpersonal side. Then the tangible is: 

• Is it a safe plant? 
• Is it laid out safely or all the safety things?
• Is it a clean plant? 
• Is it running well? 

All of that gives you a pretty deep insight into the culture. We also look at areas where we probably need to invest, grow, and bring people along, and areas where we think is better than the last plant we visited on our patch, where we can learn from. 

We expect as part of the management presentations discussion for them to talk about their values. We call it trust, empowerment, collaboration, or principles of conduct and action, what their foundation is, whether it’s the Bison way or whatever it may be. We address it that way. 

We have had management meetings where we've shared differences in our business. We would be more transparent with our teams on what we're sharing right here. And if you were more transparent with your teams, you'd have better data to share with us because there's clearly a gap between A and B. So we'll share that side of it. But again, we don't get preachy or luxurious about it.

Difficulties of Culture

Culture is such a difficult aspect to manage because it's deeply embedded into the organization. Culture is built over many years. Think of the culture of a 367-year old company, that’s a lot of years of culture. 

Here in North America, we're well over a hundred years in certainty, and so that culture goes deep in. Even if the senior leader changes how they want to drive a culture, it would take years and years and years to percolate down into the organization. 

You have to respect to some degree the foundational culture of both businesses, and realize that these key employees working in the organization that you are going to be interacting with behave in a different way, communicate in a different way, and are transparent in a different way. Don’t collaborate, then you're going to have a huge heat loss, which is just lots of energy that's going out to the atmosphere because it's internal, I won't say conflict, but debates. So, understanding what that is and how much you can influence it is critical.

Improving decision-making

Culture does eventually manifest itself in a very tangible way in terms of decision-making. Because if you're in a smaller acquisition, a very entrepreneurial acquisition, decision-making may be all up to a single person. Therefore there isn't really a decision matrix or levels of authority. It's just one person's baby, and everything runs through that individual on a smaller acquisition at times. 

However, when you come in with a large organization, there are delegated authority levels, approval levels, different levels of authority for purchasing, T&E, and CapEx. That matrix overlays an organization. 

If it's a small organization, you have to be very careful because they can't absorb that matrix because all those authority levels reside with three people. But in a larger organization, it's the same thing. You have to take a look at what their matrices are for that, and how they're delegated authority goes.

We basically map it to see where we are and where we're going, and we do a change management process to get there. We don't take anything for granted and just apply it. We go through a change management process to apply it. 

When you get your new HR benefits, your new HR programs, there's always pluses and minuses. We go through a change management process, and if you're gaining on 5 areas but there's a bit of a takeaway on one of the areas and it's an emotive area, maybe we'll bridge that gap for a year with some 1 time payments or something else. 

But we always try to put ourselves in the employees shoes, whether it be delegated authority or things that impact them. Because in the end for most employees, strategically for an acquisition, it's about what impact is it to me?

I can't expect a supervisor in a plant or an operator on a line or key sales manager to say I'm going to take a big hit on this or be completely unhappy with how things are going, because it's great for Saint Gobain. It needs to be something that I understand is okay with me too. 

Challenges for smaller companies

I've worked with some companies that are very large that buy either distributors or other types of organizations, and they come in and go very quickly. It works really well as they're built up to do that. I'm not saying our way is right, because so many things run through the same people, we actually have learned through acquisitions that have been more challenging. 

When we look at smaller companies, we put a gatekeeper between us and the small company. And so when the head of environmental health and safety wants to go do plant audits and the audit division wants to go audit the acquisition, and the purchasing division wants to go take a look at the purchasing in all these areas where we have large structures built on that so there's someone deploying, they're all coming to Mark. Mark's the guy in the small company. 

And when they come with all the best intentions, completely overwhelmed. So we put a barrier up and tell them they have to come to this integration manager. And if it's involving health and safety, financial compliance, cyber security, then we go in early, we do what we have to do, and then we step back. We let the company continue to run and do what they do, slowly but surely.

We pick off the areas of the greatest benefit. If we think we have high purchasing synergies, we get the purchasing team involved. Otherwise everybody will go in and you'll either or both overwhelm the company and add a massive cost to it because our cost structure is always going to be bigger than a small company's cost structure. And before you even know it, you've got this beautiful, young, small, or old, whatever entrepreneurial company that was sudsing along just burdened under this massive beast that’s added all these layers.

Slowly let the integration leader in. We’ve learned that by doing the other way. I have to be completely honest, going back to some small acquisitions saying what happened to that, and we learned it just got overwhelmed by the business. What you end up with is a nice little curve that is going up and it has this little dip during the overwhelming and then it goes back up and we decided to just cut that dip out. By creaking the valve, we cut that dip out.

A lot of philosophies on integration is to rip the bandaid off, and do it as fast as possible. And I've seen it done really well that way. I want to be very clear. I've watched businesses do that, where they renamed the business right away. They have their playbook. They changed the computer system right away. 

If it's a different integration structure, you have to have a different team to back you to do that. But I've seen it work really well. So I look at it. I really admire that. That's not how we do it. And so it's a combination maybe of the size and scale combination of the culture of ourselves and Saint Gobain, but whatever it may be, it can work. And so, you'll get someone on this podcast that will tell you great ways they can do that.

Common mistakes in addressing culture and integration

One of the common mistakes is not communicating enough. Almost everything can be solved by two-way communications. Listen twice as much as you speak and just take it all in. Sometimes for whatever reasons, personality, leadership, whatever it may be, someone comes in a bit stronger with more speaking than listening. That's one of the common mistakes. 

We solved this one, but allowing too many resources to go into one too soon is the one we really learned with this control valve side of it. And it goes back to when you make the acquisition: understanding when you make an acquisition that there's clear value that you bring to this acquisition and there's clear value that they bring, and making sure you keep those in clear view at all times. 

So, you know where your value is and you know where their value is. You're going to learn more, but you know what the core value you thought was, so you don't destroy their value and you leverage yours. 

Because otherwise what happens is again, you're a very large organization. You could just end up overwhelming what they bring with what you think you bring to it. I guess I had to put it in simple words. You should be extremely humble. You should be extremely humble.

Lessons learned from acquisitions

Some examples of things I’ve learned the hard way would be to make sure that you have an owner in the business. This is for smaller acquisitions, but it also goes with bigger acquisitions. 

There’s been a very large acquisition in the North American region, I view myself as the owner. Now, there's obviously really talented integration managers, there's business managers involved, but I take it extremely personally that I'm here for the transition of the closing.

I've had at least 2 smaller ones in my long career, where the driver of the acquisition left either right at the acquisition or right after or right before. The driver of it was gone and then you really lose a lot, because you can replace it but the energy that drove you to make that acquisition was gone, so make sure you have an owner that stays within it.

The ones that have been challenging have been smaller ones. When they're smaller, what I've learned in the mistakes we've made is smaller acquisitions that weren't completely embedded in something we already did. So there is a bit of an adjacency and they weren't big enough to pull us to that adjacency and therefore took time to build them up to the size we wanted to.

Small acquisitions are as hard and complicated as large ones. And they require sometimes as much resources, but they're much smaller. So your reward is very small because even if you double the EBITDA, it's still a relatively small number versus a large one, and they take a lot of resources. So, we challenge the small ones more and more. Small bolt-ons where you do everything the same and the same raw materials are really adjacent. Those are great, but as you get a little bit further, it gets harder.

Establishing strong communication

First off, none of these would work well without a really extremely talented Integration team and central services team. An acquisition could be any 1 of our 5 or 6 businesses, but it's the same HR team, finance team, IT team, and consolidation team. All that flows through the same group of people.

What we've learned that works very well is we put an integration manager in charge for a large acquisition. We have an integration manager for both businesses. So we have one from Continental, one from GCP, and one from Saint Gobain that work together as co-integration managers.

We make sure we have a very good project manager who's in charge of running the project:

• keeping it on schedule
• tracking risk registers
• understanding what's coming up and where the resources are 
• flagging when there's a gap in resources

And that reports to a steering committee, which would be myself and some other senior leaders.

The integration manager is a project manager. The integration manager’s skill set is that of a project manager. And then there's a project manager and a stream for HR, a stream for It, and a stream for purchasing. They each have their project stream, so it sounds a bit structured, but they are teams populated by both businesses. You have to have this structure in place so that when something starts to get out of whack or out of timing, it can be raised up quickly, resources can be deployed.

That's how we've built that, and that is a communication leg that is tied to making sure that what's happening in this integration team is being communicated to the employees, they're being communicated what's impacting them. And then there's just a cadence that goes on and it starts on a weekly basis, goes to a bi weekly basis, moves to a monthly basis, and then disbands when it's done.

Advice on Integration

I use the analogy of doing a plumbing project at home– it’s the first one that always leaks. You could do it again, but you don’t have to. But it's repetition that makes you better at it.

What I advise is that acquisitions can be really exciting if you do a lot of it or if you don't do a lot. There's an energy behind an acquisition. If you're doing a public company acquisition, or even a private company acquisition, you could be on calls 2-3 times a day on three time zones, seven days a week. You could be diving into some really meaty subjects.

There's a lot of adrenaline and excitement in the acquisition process, and a lot of details, teams are coming together. That's the easy part. There can be a risk that when that's all over, this breather of we've accomplished our task and all you've really done is committed yourself to some metrics you said you'd hit based on doing this acquisition.

One is to make sure that as you're going through that, you're learning in that process and you're building the integration plan behind it as you go forward. Two is to get people who are really good at project management and really good at this thing on your team. You've got to find someone, even a small company, you've got to find your best project manager.

That's not me. They will not give me a software that does Gantt charts. They just won't let me have it, so you have to find someone who lives and dies there with project managers’ skill set who can run it and you need to make sure that they drive the project going forward, because often the strategic person, the idea person, the business person is not that person who's also a great project manager.

We used external resources for integration pretty rarely. We used some HR resources for benchmarking, but if I’m just thinking through, not really. We use our internal teams almost fully.

We’ve got a great team here. They move mountains. Everything I’ve told you, they will agree with, but they’ll say I have no idea how much work we’re going to do to get this done. I do, but my point is that when you talk about bringing in 800 employees in Canada and 1000 employees in the US, bringing them on to healthcare programs, medical programs, pension programs, 401ks. Turning over all the computers in a global business like GCP on a day in a big bang. Everyone gets a new computer, all the cyber securities on it across the world. You think of all those things that take place, because we have the structure in place and then just incredibly talented people that make it work.

And they make it work because they know the goal. They know how important these are to our business's success, and they believe in the culture that it's about the people and their experience, and they do the best for them.

It’s been an evolution. From my own perspective in the last five years, we really hit our stride. But to be honest, where it's really worked well, some of the earlier deals have been very successful, but much more painful, a lot more challenging going through and we have. We’ve  gone back.

Pat Malarkey, who's really our M&A guy, a business development gentleman who's been doing this role and is a fantastic guy that loves it for so long in our business. We go back and do lessons learned. Why didn't that work? What would we do differently? 

We have this playbook and it's pretty entertaining, because he will come to me and say that this thing I’m looking at in our book has three X's on it and only two checks. And so I've got to walk him to why those X's should be checked or else we say it's not a good deal to go to.

So we have a culture here where people will come back and say if we’re trying to push the envelope on this deal and it’s against some learnings we've had, so we probably should not do it. And we've listened to that.

Retaining lessons learned

We’ve documented the lessons we learned from our deals so we can use it. We’ve had some good seniority in the deal teams so they’re there and that allows them to bring the knowledge. We’re using the same people over and over on these deals.

So Pat's been with us for decades and been doing this. I started Uncertainty in 2011, the first time, and he was working with us on deals then. I've been able to interact with him for 12-13 years.

And so, he has the respect of everybody, but also has not only this document, but the personal knowledge to walk us through it. And there's others in the team across the integration spectrum that are the same. And I go back to the fact that none of this is of any value, unless you're senior leadership's willing to listen to it.

You can't get acquisition fever. You can't get so excited about the hunt and the chase that you lose the logic that in the end, you are creating value for your shareholders and your employees, and you're building a more sustainable business that ties to the strategy of your company.

If those things don't fit, no matter how exciting it is, it will end up being a bad deal. So my role in North America is to support the growth of North America, support being the leader in light sustainable construction, and support the company Saint Gobain, to be the best business that can be for the next 300 years. If the deals don't do that, no matter how exciting they are for me. I don't do it. 

Ensuring deal value

We do a few different things. We have a very robust synergies and strategic tracker that we track on a monthly basis for an acquisition. Part of this in business is financial, so we know what financial commitments and returns we thought we would get from a sales perspective, from a profitability perspective, and from a market perspective.

We track those on a monthly basis all the way through the first three to five years of the deal, depending on if we hit the metrics and blow them out of the water in the first two years, maybe we'll only track them for the first four years. So, we're always having them in front of us and the other businesses, taking a look at it going forward.

And it’s very objective. We're being objective with it, so they're not subjective activities. That's one way that we do it. The merging of the cultures, the fact that we can get that successful one team built out of it goes to the fact of whether you're really living the values that you say you're living.

So, in the vast majority of times, we learn from each other and I believe we've got a people-centric culture. I'm sure every CEO says this, and a respectful culture that when people come into it, they know it is a good place to be, they can stay in their same role and do just what they were doing with a company that was acquired and have all the same respect and autonomy that they had or more or now they can grow in a global company and go anywhere.

So we try to make sure that you get to live your values. That's how the culture side sticks. The return side sticks by tracking. It is objective. It is manic that we were on those numbers every single month. And what are we doing and what's working and not working. And if we're not getting there, what do we have to change so that we can go back to Saint Gobain and say, when you give us money, we deliver value. And therefore, when we have good opportunities, we hope we can get money again.

Governance and M&A activities

All acquisitions go through Saint Gobain for approval and are part of our long range plans and strategic plans. Saint Gobain went through Transform and Grow in 2019 when Manuel Bazin took over as CEO and really de-layered the organization. So I’ve reported directly to the CEO, as do the other regions as to the head of the high performance materials business, and so it’s become much less matrix.

(A) Approval is depending on the size of the acquisition. We put together papers on the value, what the acquisition strategy is, why we think it's important where it fits into the strategy. It has to fit things we've talked about already. It can't be out of the blue, like suddenly we decided because it is available, that we're going to go someplace we've never talked about. It’s always tied to the strategy.

(B) Let's then talk through the strategy department. So we go back and forth, debating if it's the right activity.

If it's a big public company, if it's a big acquisition, they're involved from day one. I'm not out acquiring U. S. public companies without Benoit driving it, being involved in it, being unique to the whole process. And then, there's a board approval that takes place when you go into any binding activity.

For me, it's very seamless. We continually update our strategy. We continually communicated to Benoit and the strategy department with Saint Gobain. We're continually looking at what that may mean as far as internal and external investments. So when one becomes available or actionable, it's never a surprise.

There's a question whether the timing is right, whether the price is right, whether the strategy is still right. Those discussions take place. Sometimes we say yes, sometimes we say no. I've found it for this larger company, two different cultures, American and French, I find it very seamless.

There’s been points of friction and disagreement when it comes to this strategy going back and forth. But I've never had a situation where the dialogue back and forth didn't make sense in both places. And in the end, we got to an agreement. 

It could be an agreement against what I thought I was wanting to do and if they have a good point, we'll go forward. I'm one of six regions, plus the high force materials. They've got to deploy capital across all those. 

I may sound a little Pollyannaish. My role is to deliver opportunities for the company to look at to see where that fits where they want to go next. I try to deliver the best opportunities to win that discussion. If they come back and say they want to grow in South America at this point because they have something more interesting, my job is to get back to my desk and do my job on the rest of the business and move on. I have no issue with that. That's the role of a regional CEO. I make my best pitch. I've won a lot lately. Sometimes I don't.

Success metrics

Our success metric is value creation, ensuring that we create value with the acquisition.

• Return on investment
• ROCE
• Hitting the EBITDA 
• Hitting the Synergies
• Hitting the numbers that we communicate to the market.

They're very clear. They're very well laid out. We track and we're very harsh on how we track them to make sure that if we're saying we're having synergies, if we're saying we're having benefits that they actually show up in the PNL when the company reports the results.

It is a lot to think about the whole investor relation component of this, being a public company. You do get additional scrutiny on the seven day activity from external stakeholders. There's a great investor relationship team in Paris, and so they manage the front end of that. We share the story. They share what they need in order to make it the best going forward. 

For me, to be very simple, when we go ahead with an acquisition, I know the commitments I've made to the company for the acquisition are the commitments they've made to the investors. And so truly the message to my team is these are my personal commitments to our investors. We will hit these commitments. If we can't meet these commitments, we won't do the acquisition because it will impact the other 170,000 employees in the world by missing these commitments. 

I take it very seriously. I tell the team, it's all about our credibility and we need to continue to maintain that. The only way we maintain it is to take your commitment. So I don't have to come up with the investor relations side, I come up with the strategy side for the region. But I know that whatever we commit to, we have to hit it because that's where they're committing to our investors.

Messaging with key investors

The more complex the message for investors, the less investors like it. I'm not on that side of the world. Never have been. So I don't want to upset them, but when it's complex, even wildly strategic and makes perfect sense, will they always dig in deep enough to see that value versus where it's crystal clear?

You're expanding your gypsum business in North America. Gypsum is your number one business worldwide. North America is the second largest gypsum business in the world. You're becoming larger in North America. Pretty good message. So it's core to Saint Gobain. Technology is known globally. So North America is a big region. You're expanding into a very clear message. 

Those are always easier for the investors and I think GCP was easy, but slightly more complicated. Because it had a global construction chemicals business easily understood and building materials business, which is more North America, which we took to certainty so they had to think about splitting the two businesses. Still very well understood by investors because it's like, we were probably the only business that could have done it that had a big North American construction business and a global construction chemical business. But, I think that's what we have to think about strategically. Does it make sense to the investors without being overly complicated?

Non-core acquisitions

We tried not to do many that are away from our core because they're very hard. We generally focus on core acquisitions. One of the statements I made at one point was, I won't think of a good analogy, but if you're in the hamburger business and you want to get into the chicken business, for lack of a better word, my personal experience is buying a small chicken company to learn from, but it's probably not the right way to go. 

You need to buy someone big enough that they can drive that new leg of your business. Because if you go away from your core, you're really, for lack of a better word, you’re going to look at the North American region, or you take a look at Saint Gobain, you're really laying down another foundational pillar. 

You're not really bolting on anymore. You're doing another foundational pillar. So, in my personal view, if you go away from your core, you have to buy something big enough to be a foundational pillar. So you're sharing cultures, but they're driving you to that new business and small things that are far away from what you're doing. They don't have enough inertia to build you up in that business.

Cultural aspect of non-core acquisition

The basic culture is more involved in the sense that you end up with a situation where even if you're building a new foundational core, you're still going to have the same shared services, the same purchasing finance, IT, and cyber security.

They need to be able to work within the entity the same way. The area where it might be different is:

• they may go to a different market. 
• They may go to a different channel. 
• They may sell in a different manner. 
• They may use independent reps versus direct people. 
• They may use some other component, go direct versus distribution and distribution versus direct.

You have to respect that difference and not say we only do it this way. So I have to respect their methods of going to market. But when I say culture, it could be simplified to:

• how you interact with your peers
• your behavior
• walking down the hallway
• your behavior in the cafeteria
• Your behavior in a meeting is where you can really feel the culture of a business.

We did walk from a number of deals where we didn’t think the culture was going to fit. We've walked away probably after getting through the first phase of being in the second group of people, being in the final group of people looking at it. Either through management presentations or through other red flags that just made us feel like it was not a good fit. 

And it goes the other way. Understand that they can walk away from you too. Public company deals are slightly different from others, but when you're in an M&A deal, they can leave too. They can decide that my culture is not right, that my team doesn't fit. And they never have to say that, they can just not accept your bid or downgrade your bid from some level. So, try to make sure that you're selling why you would be a good partner.