'Star' culture holds back financial sector mergers

"Some banks are awful at making acquisitions work, much worse than firms in other sectors," said Hubbard, who has advised several of them on how to go about it. The problems began when they accommodated their prima donnas after an acquisition.

"Sometimes they change everything to suit their stars, who may be throwing the toys out of the pram. This is not the way to behave when you are trying to integrate large numbers of people."

However, some banks manage takeovers successfully, particularly if their human resource department is influential.

Hubbard was speaking after a speech in which she drew parallels between good takeover practice by multinational firms and the Roman Empire. The Romans left existing rulers in place wherever possible. In an empire with dozens of languages and peoples, they did not interfere with local customs except occasionally, to impose best practice.

They also provided long-term incentives to their soldiers, by offering them retirement benefits after 20 years' service. They were good at identifying non-core territories and disposing of them and were masters of expectation management.

In a separate speech, human resources staff at UBS explained how they had used new HR software to improve the performance of their private banking arm.

Mark Wardle, an executive director at UBS Wealth Management and Business Banking, said problems began in 2000, due to new competition and market conditions around the time of the merger between UBS and SBC. "Our private bankers' phones stopped ringing. And our staff didn't know what to do."

The solution was to identify what new skills they needed through computer questionnaires. Each member of staff gave themselves a ranking in important areas, such as understanding products and leadership abilities. They were also ranked by their managers and the results were compared, with checks to ensure that all managers adopted a consistent approach.

As a result, a new picture emerged about which staff needed what training courses and types of practical experience. "It enabled us to see what was really going on far better than before," said Wardle. Recruitment practices changed to reflect what the bank had learnt.

The software also led the bank to discover that some members of staff were being paid more or less than industry norms, and to take action.