Creating post-M&A cohesion for a global mortgage and finance group
Pepper Money acquires Optimum Credit
9.5 /10
Town Hall employee satisfaction score after project (up from 7.5 out of 10)
98%
Of staff believe that continuing the approach will build a better business and brighter future.
Where they were
Pepper Money is an award-winning specialised mortgage lender based in the UK, and part of the global Pepper Financial Services Group.
In 2021, they completed the acquisition of Cardiff-based company Optimum Credit. But the M&A process had revealed a series of cultural challenges – the existing cultures at Pepper and Optimum represented totally different ways of working and seeing the workplace, and Pepper was struggling to apply the global group’s values in a way that resonated with Optimum’s employees.
Where they needed to get to
In order to make their acquisition of Optimum a lasting success, Pepper Money needed a way to bridge the gap between the two existing company cultures.
Threading that needle wouldn’t be straightforward. Although the team in Cardiff needed a more tailored approach than applying the Pepper Group’s values directly, that didn’t mean they were able to completely diverge. The goal of the merger was to integrate Optimum Credit into Pepper Money, and so there needed to be a strong thread of consistency between them and the wider group.
That meant they needed to dig deep into the current cultures at both Pepper and Optimum, understand where they were similar and where they diverged, and develop new behaviours, ways of working and cultural priorities that would knit the new entity together.
How we drew the roadmap
Our work with Pepper Money followed our award-winning 3-stage culture change methodology. Here’s how that looked in practice.
Stage 1: Insight
With two very different workplace cultures at play, understanding the lived realities of both Optimum and Pepper Money was a crucial first step to unpacking the complexity of their challenge.
We engaged with senior leadership and employee teams at both Pepper Money and Optimum Credit to really get under the skin of both cultures, encouraging openness and honesty in every interview, focus group and survey.
To focus these discussions, we developed a bespoke Cultural Assessment Framework. This enabled us to:
- Gather insight into the cultural dynamics within both businesses
- Pinpoint which were the best elements of both cultures to hold onto, and what could be changed
- Understand the cultural links between the UK and global Pepper Money business
- Identify immediate actions to kick start behavioural alignment
Stage 2: Design
After the Insight phase, we facilitated two senior leadership workshops to validate the conclusions we’d drawn, and agree on a cultural change journey that would better align both businesses.
That journey resulted in the Pepper Way: a set of 4 cultural principles that were distilled from the Pepper Group’s global values but tweaked for Optimum Money’s team in the UK. These principles could underpin the culture of the new, post-M&A business, and help to create a more consistent thread between behaviours and ways of working at Optimum and Pepper Money.
To cement the Pepper Way, we created a culture narrative to link up the past of both companies with their present dynamic and their future strategic goals.
We also designed a practical framework of expected behaviours that translated the culture into day-to-day situations. This also included the essential FCA regulation requirements, which would help Pepper Money guarantee compliant ways of working across the business.
Finally, we helped Pepper Money identify anywhere that policies, processes, governance or work practices could be changed to better align with the new cultural principles. As well as reinforcing the Pepper Way, this also helped redesign the employee experience – a critical factor in attracting and retaining talent in the future.
Stage 3: Embed
Once Pepper Money’s redefined culture was ready to launch, we worked with their HR, leadership and management teams to embed the Pepper Way as a lived reality.
We co-faciliated Team-Based Embedding workshops at scale. During these sessions we:
- Dove deep into the new ways of working and their impact on the business
- Outlined how each of the 4 cultural principles would be embedded in day-to-day work life
- Supported teams with specially designed toolkits, including videos, detailed process documents, workshop templates and best practices.
These workshops also had a strong focus on closing any gaps in capabilities among teams. We ran special masterclasses to upskill Pepper Money’s managers, giving them the tools they needed to own the culture change moving forward.
Where Pepper Money is now
Since launching their new culture, Pepper Money has seen its positive impact right across the business.
Employee Morale is higher than ever
- Pepper’s employee satisfaction score rose from 7.5 to 9.5 out of 10 after the culture change project, and their Trustpilot score has increased significantly too.
- Employees feel more connected to the business purpose and strategy, and 98% say that continuing team-based embedding sessions will build a brighter business future.
Values and embedded in the everyday
- Following team-based embedding, all teams are now in the rhythm of regular review cycles.
- Teams and employees have the understanding they need to embrace the new culture and challenge their previous ways of working.
Communications and development pathways have improved
- Pepper Money created the Pepper Academy, a new internal learning and development initiative including regular “lunch and learn” sessions.
- A new podcast, The Specialist, was successfully launched both internally and externally.
What the client had to say
“We were so impressed with Culture Consultancy. They have taken something very complicated and made it simple. We’re thrilled about the new culture they helped us create, and the way that they’ve supported and challenged us throughout has pushed us on even further than we could have anticipated. We’re seeing early signs of a successful M&A and we couldn’t be more excited for the future of the business.”
Greg Ingleton – HR Director