required to market each product in a
new but well-established market. The
Human Resource department is al-
ready addressing compensation equity,
health benefits, leave policies and other
issues where there may be disparities
between the rights of US workers and
foreign workers. You are not yet aware
of how differences in cultural orienta-
tion have set the stage for a significant
“culture clash” that will threaten the
execution of the business strategy.
gumbo producers strongly object to
their product being distributed in cans,
asserting that metal containers alter the
flavor of the gumbo. A series of tests
determines the objection has merit.
As a result, distribution of the gumbo
product in US markets must cease
until a decision can be made about a
packaging alternative. Worse still, it ap-
pears that marketing the chicken soup
in cans in foreign markets will also be
problematic. Changing the packaging
is a cost that was not considered prior
Your role requires you to protect the to deal close. While decision-makers
merged business against any risk that are working around the clock to get
could negatively impact operations. the packaging problems resolved, the
The first issue that must be addressed best R&D employees of the acquired
is “quality control” in the production business leave the company, dissatisfied
of the gumbo. This means imposition with the lack of autonomy and con-
of procedures that must be strictly ad- vinced that their former employer will
hered to, to ensure that gumbo mar- end up trashing the reputation of an
keted in US markets meets USA FDA excellent gumbo product they have de-
standards. Until that is accomplished, veloped. They approach the two large
all test marketing of additional gumbo US competitors of the merged com-
products must cease. Unexpectedly, pany with an offer to develop an entire
packaging also becomes an issue. The line of excellent gumbo products to be
chicken soup is marketed in cans. The marketed in the US. One of the com-
petitors buys their pitch, agrees to pay
premium salaries with performance
bonuses, and grants them control over
test marketing and gumbo production
in the US. The competitive advantage
the acquisition was designed to cre-
ate evaporates. One year following
deal close, the leadership team of the
chicken soup company must acknowl-
edge lost US market share, an inability
to price the gumbo marketed in the
US competitively, and strong competi-
tion from the branded US competitor
in the foreign markets.
The strategy that looked so promising
on paper was derailed. Cultural differ-
ences that decision-makers overlooked
killed the value of the deal. The lesson
learned, too late, is that it may not be
as easy as it looks to integrate chicken
soup with gumbo.
Connie Barnaba, president, Barnaba
& Associates, Inc., is a CM&AA and
GPHR. Visit the website at:
www.businessmarriages.com
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