M&As, Restructures and… CULTURE!

M&As Restructures And Culture

This article is the first of our wider series of articles focusing on the book I co-authored with Fleur Bothwick OBE, ‘Inclusive Leadership’ over a decade ago. One of the core principles of the book – embedding an inclusive culture into everything we do – is an increasingly important anchor point for leaders as we face growing levels of change, uncertainty and opportunity within our organisations.

As leaders, it’s important for us to not lose sight of how inextricably linked culture and performance are to each other and, as restructures and reorganisations continue to increase in frequency, we need to focus on our culture, as well as taking responsibility for it, now more than ever.

Restructures and reorganisations have become inevitable against the backdrop of the 2020s due to the pandemic, economic uncertainty, growth in technology and responses to the shifting geopolitical landscape. The mergers and acquisitions (M&A) market, for example, surged in 2025, growing 40% to $4.9tn. A Bain & CO survey of M&A Executives found that ‘80% expect to sustain or increase deal activity in 2026’.

When we consider restructures, we only need to glance at the news to see which company is the latest to be conducting rounds of redundancies.  What doesn’t have to be inevitable is a detrimental impact on our organisations’ cultures.

Mergers, acquisitions and reorganisations can result in two factors from a people perspective (i) an increase in uncertainty amongst employees, and/or (ii) an opportunity to test the strength of your organisation’s culture.

Research by Hsin Ling Ku (2025) found that organisational restructures can strain an organisation’s culture, engagement and productivity.  Their research identified key challenges such as ‘leadership struggles, employee resistance, communication issues and legal-ethical dilemmas’.

Without going into too much detail, it’s clear that each of these will have a significant impact on our cultures, engagement and – overall – our productivity if they’re not addressed properly.

I’d be curious to understand how these are experienced within your own organisations and if they ring true to you as current issues you are grappling with.

Hsin Ling Ku (2025) also explores Social Exchange Theory in the context of reorganisations and restructures, suggesting employees examine the perceived costs and benefits associated with reorganisations and restructures to inform how they respond. Leaders should, therefore, consider their own approach to get the best outcomes by not compromising culture and engagement.

To bring this back to our book, ‘Inclusive Leadership’ there is an opportunity for leaders to embrace and leverage Inclusive Leadership principles to do this effectively.  These inclusive leadership principles include ‘be transparent’ (wherever possible), ‘shape and deliver with colleagues’, and ‘communicate inclusively’, to name a few (there are nine in total).

So, why does all this matter?

Why can’t we just focus on our reorganisations and what really matters – protecting and expanding our bottom line and increasing our value? I’d go as far as to argue that you can’t truly increase your bottom line and value in a sustainable way without putting your people and culture at the heart of this.

Despite a growing reliance on AI and technology, people remain central to our organisations’ successes. How we navigate our restructures and reorganisations has a direct impact on our culture and employee engagement which then impacts our organisations’ performance (Chelangat, 2022). It makes business sense not to lose sight of our organisations’ culture as we navigate the opportunities and challenges presented to us as business leaders.

We recognise that each organisation’s context is unique and requires a carefully considered plan of action. If you are working through a reorganisation or restructure currently, or predict there may be one looming on the horizon, I encourage you to reflect on these three questions:

1. What culture are we actually designing through this restructure?  Is this one that we would actively choose? If not, why not?
2. If this transformation succeeds financially but fractures our culture and trust, will we truly call it a success? What are the steps you would consider to ‘remedy’ the culture and trust fractures?
3. If we paused the restructure tomorrow, what cultural risks would already be irreversible? What impact would they continue to have?

 

When I sit with Executive Teams in the middle of a restructure or post-acquisition integration, the conversation is almost always disciplined with a laser focus on the return on investment (ROI). I rarely hear the same level of rigour applied to the culture that is being reshaped in real time.

Every restructure creates a culture, whether leaders like it or not – some are designed, but many are by default.  It signals whose voices carry weight, what behaviours are rewarded under pressure and how safe it is to challenge decisions.  These signals travel faster than any town hall message.  They shape belief long before the new operating model settles.

That is why embedding inclusion and intentionally planning for a healthy culture is not a ‘nice to have’ alongside structural change. It is integral to whether the change succeeds at all. If trust erodes, if certain groups quietly conclude that opportunity has narrowed, if managers are unequipped to lead fairly under times of pressure, the financial logic of the restructure is steadily undermined.

Despite this, too often when inclusion and culture are discussed during transformation, it’s relegated to the margins. The conversation drifts towards symbolic gestures or awareness campaigns that are visible but not material, performative and not practical.  If this sounds familiar, or you haven’t considered this at all yet (that’s okay), you’ll want to get in touch with us.

We’re experienced practitioners and pragmatists in this area and our goal is to support organisations through complexity, helping them to realise the power they hold by embracing inclusive workplace cultures and reaping the benefits that this focus can have as you navigate reorganisations, restructures and change.

To speak to one of our experts in culture, inclusion and leadership, please get in touch via the button below.

You’re not alone!

This article is a part of our 'Inclusive Leadership 10 Years On' series. See more about the series here.

 

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Co-authored by Charlotte Sweeney, OBE & Elizabeth Pollitt 

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Sources:

Bihani, A. (2026) Amazon, Microsoft, Intel and other major US layoffs: Report, INDmoney. Available at: https://www.indmoney.com/blog/us-stocks/layoffs-report (Accessed: 05 February 2026).

Chelangat, B. (2022) ‘Organizational Culture and Organization Performance: A  Critical Review of Literature’, Journal of Business and Management, 24(2), pp. 43–47. Available at: https://www.iosrjournals.org/iosr-jbm/papers/Vol24-issue2/Ser-4/F2402044347.pdf

Ku, H.L. (2025) ‘Difficulties in organizational restructuring: A systematic  literature review’, International Journal of Management and Business Studies, 15 (1)(2167–0439), pp. 001–009. Available at: https://www.internationalscholarsjournals.com/articles/difficulties-in-organizational-restructuring-a-systematic-literature-review.pdf

Stafford, D. et al. (2026) Looking ahead to 2026: Getting a boost from the great rebound, Bain. Available at: https://www.bain.com/insights/looking-ahead-m-and-a-report-2026/