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4/15/2006 12:02:00 AM

Communicating change can determine success or failure in mergers and acquisitions

How organizational changes are perceived may depend on a person's cultural perspective. For one group of employees, organizational change may signal loss of control and create a lack of trust. For others, it may imply criticism of the past or traditions. According to Deborah Barrett, a senior lecturer of management and director of the MBA Communications Program at Rice University's Jesse H. Jones Graduate School of Management, effective communications across cultures can be the difference between success and failure during critical organizational changes such as mergers and acquisitions.

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In today's global economy, employees often reflect tremendous cultural diversity within their organizations. The 100,000 employees of Procter & Gamble Co., for example, represent more than 100 different cultures. According to Barrett, the success of a merger or other significant organizational change can depend upon how effectively its leaders communicate with employees across different cultures.

"Communication is the key to obtaining employee support and understanding, which are particularly critical when a company is undergoing change," Barrett said.

"To convey why changes are occurring effectively and what they will mean to employees, today's corporate leaders need to develop a communications strategy tailored to the diversity of their organizations."

The key to such an internal communications strategy, according to Barrett, is a cross-cultural advisory team. Respected and trusted by their peers, the team should consist of open, honest communicators representing the major cultural groups within their company. Their primary responsibility before and during the corporate change is to help identify the different cultures among employees by way of a cross-cultural analysis of the company. From there, the team can assist in tailoring the message and help with employee interactions as the change is being communicated.

"Since they represent different cultural groups, the cross-cultural advisory team can also help prevent the company leaders from generalizing or stereotyping cultures," Barrett said.

Cultural differences can be reflected in how individuals view time, power and equality, whether they emphasize the individual or the community, and whether they belong to a high- or low-context culture.

"In a high-context culture like Japan, for example, nonverbal clues and relationships have more meaning than words," Barrett explained.

"In a predominantly low-context culture such as the U.S., individuals respond more to words than to images."

Similarly, there are cultural differences related to time. High-context cultures tend to see time as open-ended and people as more important than promptness and schedules. By contrast, in low-context cultures, "time is money," and individuals put a high premium on time.

One cultural difference that Barrett believes is particularly important but rarely considered when outlining a communication plan about change is spirituality. She argues that a change leader needs to know if a cultural group among employees believes in a higher being or some other source of power outside of themselves.

"Their spiritual perspective can influence how they view equality and the hierarchy within the organization," Barrett said.

"It also can reflect if they are very traditional or secular in their beliefs and values."

In an article entitled "Successful Cross-cultural Communication During Major Change," Barrett described step-by-step what should be included in a cross-cultural communication strategy. In addition to identifying the organizational change itself, Barrett noted that company leadership needs to explain to employees how and why the change is taking place and what the impact will be on the company and them. The timing and medium of the message and choice of spokesperson are also critical.

"Organizational leaders involved in change need to be excellent communicators," Barrett stressed. "They have to be culturally sensitive and understand not just the audience, but themselves as well."

An expert in internal and external communication strategies, change management and management consulting, Barrett has taught business, technical, and team communication for the last 25 years. Before joining the Jones School faculty in 1998, Barrett was a senior managing director of Hill & Knowlton in Houston, and prior to that she served as a communications consultant at McKinsey & Company, where she was a leader in their change communication practice. Her latest book, published in 2005 by McGraw-Hill, is "Leadership Communication."

For more information on this research, contact Barrett at barrett@rice.edu or Debra Thomas in the Jones School at dthomas@rice.edu.