The company became more and more successful and took customers from much bigger and more established companies. It wasn't long before one of the bigger players in the market decided to acquire them. This bigger company was very different. Their business had been around a lot longer and was built on very structured and solid foundations, so their methods were more defined and rigid. They were well known enough that they didn't have to go out and find customers, and their employees enjoyed the long term security they got from being part of a something steadfast and solid.
The new parent company worked to amalgamate the services of the smaller company into their existing offerings, focussing on putting structure around them and solidifying with operational processes. The aim was to turn all the acquired companies services into packages which could be sold off the shelf to those who came to the business to buy them. The acquired employees were brought from being in the nimble management structure of the small company into the deeper structure of the bigger company.
Over the next while, the employees of the smaller acquired company started dropping like flies, to the point that six months later all their best people had left. A year later the offerings from the smaller company were unrecognisable, and it wasn't long before sales decreased and the reputation of the original company was lost.
Many factors attributed to this outcome, but the factor that was most evident to me was that the businesses had completely different identities. Metaphorically, the smaller company was like a ship, with a captain at the helm and adventurous employees out out there and sharing their offerings. The larger company was like an architectural building; solid, sturdy, stedfast. Separately they were both successful in their own ways, but together it just didn't work out.
To look at the clash of the metaphoric identities, the problem was that the ship got grounded. Ships are built to be out there in the ocean, so when it was put up in the docs it simply couldn't fulfil it's purpose anymore.