So it is crucial that each business makes the merger and acquisition (M&A) process as smooth as possible for employees. Management has a duty to staff to ensure stability during the upheaval process, workers should stay productive to maintain customer service levels, and customers need to appreciate that changes could impact their own businesses in the short-term.
Effective management assists this process, as does conducting the appropriate corporate governance and the implementation of any necessary legal and human resources (HR) measures that ease the change.
Mergers and acquisitions are often complex affairs, and they can serve up unexpected challenges that cannot be planned for, however if handled carefully they are still one of the most effective ways to deliver large scale growth.
Other advantages include greater business efficiency, increased competitiveness, a surge in innovation, and a larger market share, though these will only occur if appropriate measures are put in place.
Paving the way to success
It is important to remember a merger or acquisition is not a project with a definitive end and therefore a clear strategy is vital, as is displaying caution during the integration period. There is no single blueprint for success, but an effective strategy contains some, if not all, of the following elements:
- An advisory board that includes relevant stakeholders from both businesses and an external specialist to ensure both companies stay focused on objectives;
- A new, united company that shares a single vision and route to market;
- Consistent, regular communication with employees to discuss concerns;
- A comprehensive feedback system that welcomes resistance and advice;
- Evaluative measures and the capability to tackle any potential roadblocks; and
- A desire to share success and celebrate together
Alongside maintaining realistic expectations, another key consideration mentioned above is the appointment of an advisory board. It is wise for this to include senior representatives from both companies, major stakeholders, and an outside specialist that is experienced in the relevant industry.
As the external advisor, being respected is crucial, otherwise they could feel undermined and deliver ineffective advice based on misinformation. It is likely they will have to mediate difficult situations, but they need to know their advice is being trusted and that their project management skills are valued.
Support is crucial, as this will filter through to the employees undergoing the merger or acquisition. Staff want to know they are being listened to and that they have a voice during the transition. Staff regularly need reassurance that the process is running smoothly, a time when communication is particularly important.
Staff engagement is another area where it might be worth considering external assistance. Group briefing sessions, on-boarding programmes and regular one-to-one meetings are all effective practices for keeping staff morale high, as long as they are engaging. A training specialist will have the knowledge to design a process that can make an immediate impact.
Essentially, if employees are unsure why a change is taking place they are more likely to lose focus, which can affect the overall success of the merger or acquisition. People that are fully immersed in the changes will have the knowledge to lead the new company in its fresh direction.
This is the crux of strategy. A successful merger or acquisition is one that positions a business for the long-term.
Success cannot be fleeting; it must be sustainable. Regular meetings with the advisory board can highlight prospective areas for improvement long after the official process is considered obsolete and it might reveal projects that need strengthening that were overlooked during initial proceedings.
Irrespective of the immediate outcomes there will always be room for improvement; this applies to every company, especially those that have suddenly united under a single mission. If management remains focused on the long-term objectives and puts a tailored strategy into action, there is little reason why the merger or acquisition will not deliver its desired outcomes.
Esther McMorris is founder of Nine Feet Tall.