5 MINUTES WITH ALISON ETTRIDGE, CEO OF TALENT INTUITION & LEAD DEVELOPER OF PI3, THE CULTURAL COMPATABILITY TOOL
We spoke with a former Monster.com director about one of the only cultural due diligence tools available on the market.
In more recent years, Alison Ettridge has led the commercial management and then the P&L for the PE-backed Armstrong Craven and Capita-owned Write Research respectively. She guided these talent sourcers through leadership shifts and people integrations, before setting up her own talent analytics consultancy, Talent Intuition. Her unique experience in talent is near unrivalled in the UK and permits a unique perspective on investors' and directors’ response to culture when two outfits start to act as one business. This led her to spot an opportunity in the human capital advisory market. And so, with a trusted corporate psychologist and software development partner, she spearheaded the development of Pi3 ("pie 3").
As a flagship feature of Talent Intuition’s solutions, Pi3 is a cultural compatibility tool that helps identify similarities and differences between units and functions.
As a flagship feature of Talent Intuition’s solutions, Pi3 is a cultural compatibility tool that helps identify similarities and differences between units and functions. It is particularly popular with mid-cap PE firms. And unsurprisingly, Alison is now managing interest from multi-nationals. This includes a project providing directors, at a FTSE 100 corporation, with a cultural integration map as they unleash the combined power of their customer-facing teams.
Speaking personally, as a head-hunter, poor cultural outcomes post-integration is common trigger for multiple complaints from clients and candidates alike. I spoke to Alison about how Pi3 reduces people risk in integration and what tends to be found.
What exactly is Pi3?
Pi3 is a web-based tool for companies to compare cultural differences and similarities between multiple leadership teams or the critical staff-members, who are increasingly working together, post restructure or deal.
The data is collated via a platform, surveying major groups or just the executive team. This can be conducted across functions and countries thus helping integration teams to prioritise activity. The surveys take minutes to complete and visually supported analysis, in report format, is generated hours afterwards.
Alison’s clients tend to be concerned about the potential loss of incremental, organic and acquisitive growth
What triggers in-depth cultural assessment?
Alison’s clients intend to: help integration leaders understand the management teams they're acquiring (leadership buy-in), guide team integration and in the context of bolt-on acquisitions, they tend to be concerned about the potential loss of incremental, organic and acquisitive growth.
Focusing on investment or acquisitive activity, PE firms wish to identify culture and people related threats. Especially, those with business models that depend on large numbers of staff-members facing customers. So, arenas where any change to the culture or loss of headcount would quickly and directly impact on the bottom line. Alison remarked that some PE outfits deliberately target bolt-ons that have disrupted whole sectors and then need to merge them in to more traditional companies.
“My clients might ask, ‘Do our board
and our leadership team share the same appetite for risk?’
“My clients might ask, ‘Do our sales and product development team have a cultural clash?’; ‘Will our French leadership team interact well with our Australian leadership team’; ‘Do our board and our leadership team share the same appetite for risk?’ Pi3 forms the basis upon which leaders can shape action plans to identify and address the most severe cultural gaps.”
Alison recommends that the review takes place as early as possible in the deal process.
What tends to be found?
Pi3 uncovers similarities and differences across eight big cultural spectrums. So, the in-betweens are gauged relating to two opposite behaviours using a measurable scale. Insights uncovered include:
Set procedure versus judgement. Extensive sets of rules versus few written policies. Right and wrong versus simple values. Meetings with a clear agenda versus tackling issues as they’re
Focus of teams
Internal procedure (and meetings) versus customer needs. Time consuming internal relationships versus light touch.
Attitude to risk
Taking time to make decisions versus being action orientated. Consultative decision making versus key personalities calling the shots. Deep analysis versus judgement and experience. Risk avoidance versus intelligent risk taking.
Attitude to change
Sticking to tried and tested versus new ideas. Needing to influence to secure change versus being encouraged to. Expectation of others to respond sceptically to something new versus being open minded. Preference towards tradition versus innovation.
Longer term view
Quarterly financials versus longer-term growth. Zero time for emerging issues versus making time. Preference to fire-fight over industry shaping. Weighting between short-term KPIs versus long term ones.
Insights around collaboration, decision-making and freedom are also collated.
Areas of interest are readily flagged for further investigation. Alison explained, “Integration teams (tend to) focus effort where the gap is largest, or on the teams where a cultural difference is most likely to impact on the bottom line.”
Where differences are extreme, the deal can be pulled
What impact do the findings have?
Pi3significantly reduces the impact of people attrition and disengagement. It saves time by ensuring key people are maintained and limits the overall chance of failure. Similarly, stability of service is maintained for accounts and the new business pipeline (often what the financial backers are most interested in). Where differences are extreme, the deal can be pulled.
Culturally speaking one might think these two businesses were very similar; however, the product and the consulting teams were effectively competing against one another.
For a typical impact, Alison pointed to the technology sector where a cybersecurity software-as-a-service provider was merging with a consultancy advising on the same subject. Culturally speaking, one might think these two businesses were very similar; however, the product and the consulting teams were effectively competing against one another. Pi3 provided a foundation for a plan to align incentives.
Equally, some stakeholders have been surprised by the ample similarities between businesses and have been pleased to identify opportunities to leverage those synergies to generate further value.
Alison adds that very recently, groups of leaders (at a FTSE 100 company) have been invited to adapt their own behaviours given their personal cultural maps versus those of the business being leveraged. Whether such advice has been readily acted on remains to be seen!
While not fully exploited yet, the survey can also be rerun at a later point in the integration so a firm view can be made around the direction of travel of the business culturally and what that might mean for future leaders and staff members. And, whether the business is ready yet for such people – something as a head-hunter we often have to ask our clients!
How can prospective and existing clients find out more?
By calling the team at Collingwood on 00 44 1829 732374.