Tying the Knot: A Guide to Mergers in Microfinance

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Abrupt or unanticipated change. Change is inevitable, but people deal with change in different ways. If changes made during a merger are not explained to staff clearly enough, or if staff do not know what to expect and when, the result can be internal chaos, stress on internal relationships, and adverse effects on clients and on the institution’s public image.

Lack of cultural awareness or sensitivity. Management must pay special attention early on to cultural differences on both sides, as well as individual differences involving staff members from the partner organization whom they do not know well.

Insufficient time. Sometimes people simply need time to adjust. Building an environment conducive to cultural integration, where openness, trust, and a sense of unity prevail, can take much more time than is usually anticipated. It can take six months to a year, or longer, for staff to develop loyalty toward a new merged entity. It’s futile to try to push something when people are not yet ready.

Micro-F vs. Kamurj: The Armenia Logo Design What’s in a Name? Everything. That’s what we discovered when we tried to come up with a new name and logo for the merged institution. At the very first workshop, where we developed the merger transition plan, we tried to make a fun exercise out of choosing a new name, which seemed like a good way to bring everyone together to address a common task creatively. We also needed a neutral name to call ourselves while the merger process was underway. Instead, the exercise caused even greater divisions among staff because of the intense attachment each side had to its own name and logo. Name is identity, and neither side wanted to give theirs up. Rather than pushing too hard at the first workshop, we decided to let the matter rest and bring it up again on another occasion, after emotions and attachments had mellowed. In the meantime, we held a contest for all staff members to propose names and logos.

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