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Why Governance Gaps Appear After Mergers and Acquisitions

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Governance gaps appear after mergers and acquisitions: when a single customer complaint crosses sales, delivery and parts that never fully merged.

The symptom

Consider an organisation, recently formed through the combination of previously separate parts, where a customer complaint touches sales, delivery and support in turn. It takes eleven days and four handovers between teams to resolve — despite each team responding promptly once the matter reaches them.

What leaders usually conclude

The standard diagnosis is departmental silos: the teams are not communicating well enough with each other, and the fix is more cross-functional coordination, more shared visibility, a better handoff process.

What the evidence suggests

On closer inspection, each department handled its own portion of the complaint promptly and correctly. No individual failed, and no team was slow within its own remit. What was missing was not coordination between teams that had responsibility — it was ownership of the complaint as a single, whole thing. The organisation had allocated accountability by function. The customer’s actual experience ran across functions. Nobody was failing; the complaint as a whole simply belonged to nobody.

This is a particularly common shape for governance gaps to take after a merger or acquisition, because the combination itself tends to produce exactly this kind of functional allocation without anyone deliberately designing it. Two organisations, each internally coherent on its own terms, are joined together with their respective functional boundaries largely intact — sales from one side, delivery from another, support built to serve a structure that no longer quite matches the combined entity. Cross-functional ownership, which may have existed informally in either organisation before the combination, rarely survives the transition intact, because the people who held that informal ownership were often specific individuals whose role, context, or continued presence the merger did not preserve.

Competing explanations

There is a meaningful difference between a coordination failure — teams that have the necessary accountability but communicate poorly — and an accountability gap — a situation nobody is actually responsible for as a whole, regardless of how well the parts communicate. The eleven-day, four-handover complaint in the scenario above looks, at first glance, like the first. It behaves, on inspection, like the second: better communication between teams that are each doing their job correctly does not create ownership of the thing none of them owns.

A further complication is that this kind of gap is often invisible until a specific case crosses every relevant boundary at once, the way a customer complaint touching sales, delivery and support does. Simpler cases that stay within one function never reveal the gap at all, which is part of why it can persist undetected for a considerable time after the combination that created it.

The consequence of leaving this kind of gap unaddressed compounds specifically because it is hardest to see in the cases that would justify fixing it. Each individual instance can plausibly be explained away as an unusual, cross-functional edge case rather than evidence of a structural gap, since most of the organisation’s day-to-day work stays within a single function and never touches the problem at all. This means the accountability gap can persist for a long time on the strength of an entirely accurate observation — that most things work fine — while the minority of cases it actually governs, often the ones that matter most to a customer’s overall experience, continue to take far longer than they should.

A common misconception after a merger or acquisition is that cross-functional gaps are primarily a communication or culture-integration issue, best addressed through joint training or shared systems. Communication and shared systems can help, but neither one, by itself, assigns accountability for an outcome that crosses every function’s boundary. Without a deliberate decision about who owns the whole rather than a part, improved communication mainly means the same underlying gap is now discussed more fluently, rather than actually closed.

It is also worth distinguishing this from a resourcing problem. Adding headcount to sales, delivery or support individually would not close the gap described here, because none of those functions is under-resourced within its own remit — each responds promptly to its portion of the complaint. The missing element is not capacity but a form of accountability that does not naturally belong to any single function, since it is defined by the customer’s experience across all of them rather than by any one department’s own performance measures.

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Questions worth considering

  1. Is anyone accountable for the outcome as a whole, distinct from being accountable for a portion of it?
  2. Following a merger or acquisition, which cross-functional ownership existed informally in either organisation beforehand — and did it survive the combination, or disappear along with the individuals who held it?

More on this topic: Governance.

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Frequently Asked Questions

Not always. What looks like a communication problem can instead be an accountability gap — no one is responsible for an outcome as a whole, even though each team handles its own portion correctly.
Combining two organisations typically joins their existing functional structures without fully replacing them, and informal cross-functional ownership that existed before the merger often does not survive the transition.
One approach is examining cases that cross every relevant functional boundary at once, since gaps of this kind are frequently invisible in cases that stay within a single function.
Better communication can help teams coordinate, but it does not by itself create accountability for an outcome that no single team or role is actually responsible for delivering.
Not directly. The departments in this pattern are typically not under-resourced within their own remit — each responds promptly to its portion of the work. The missing element is ownership of the outcome as a whole, which additional headcount within existing functional boundaries does not create.
A coordination failure involves teams that hold the necessary accountability but communicate poorly. An accountability gap is a situation nobody is responsible for as a whole, however well the parts communicate. The page suggests a slow cross-functional complaint can look like the first while behaving like the second.
It tends to stay hidden until a case crosses every relevant boundary at once, and the bulk of day-to-day work stays within a single function. Each instance can be explained away as an unusual edge case, so the accurate observation that things mostly work fine can sustain the gap while the cross-functional cases continue to take longer than expected.
Not necessarily. In the example on the page each department handled its own portion promptly and correctly, and no team was slow within its own remit. The delay arose because the complaint as a whole belonged to nobody, which is a feature of how accountability was allocated rather than of any individual’s performance.