Managing Changes in Mergers and Acquisitions

Managing Changes in Mergers and Acquisitions

Mergers and Acquisitions

Issues with Mergers and Acquisitions

Motivation and retention of key people in mergers and acquisitions

People related issues are the most critical characteristics which leading to success or failure of mergers and acquisitions (M&As). Leaders should concern on deal with the problems of how to keep the team motivated and retained in the time of mergers and acquisitions implementing.    

There are few reasons for difficulties to motivate and retained of key people in the organizations.

Findings - The main reasons why the motivation and retention of key people during M&As are so difficult to master are that often damage is done prior to the closing of the deal. It is hard to handle the speed at which M&As are concluded and so it can be difficult to quickly and efficiently identify the key people to retain. The right packages need to be designed to retain the right people and communication with employees retained, as well as those not retained, must be maintained.

Practical implications - Keeping key people motivated and committed will help to retain them even during such complex times as M&A transactions, but also beyond. It is essential to prepare, as early as possible, detailed integration plans that include the identification of key people and the design of retention programmes, with the latter assisting in meeting retention goals. Communication of these elements, and other deal‐related issues, must also be effectively maintained.

Effective Communication in mergers and acquisitions

One of the most important elements of successfully facilitating a company merger or acquisition is effective communication. While this may seem relatively basic or obvious, the truth of the matter remains that communication can make or break a merger or acquisition. While successful, transparent communication can create a smooth transition, ineffective communication will cause disruption, confusion and insecurity that may cause a merger or acquisition to fail.

components of effective communication 

Frequency
Consistency
Transparency
Honesty
Efficiency

 

Cultural integration in mergers and acquisitions

Addressing culture when two companies integrate A rigorous program with clearly stated objectives should be put in place to address cultural integration. Too often, culture is presented as a wooly and soft topic. When that happens, executives tend to slight the issue. This can generally be avoided by linking the cultural program to measurable business results. There are several steps to doing this:

Make culture a major component of the change management work stream.

Identify who "owns" corporate culture and have them report to senior management

Insist that the cultural work focuses on the tangible and the measurable.

 

Consider the strengths of both existing cultures, not just the weaknesses.

 

Implement a decision-making process that is not hampered by cultural differences.

 

Build the employee brand with a view toward how it will be understood by employees.

 

Put people with culture change knowledge and experience on the teams that define the key interfaces in the new organizational model.

References

Gould, R., 2015. Mergers & Acquisitions: The Importance of Effective Communication. [Online]
Available at: https://www.gould-partners.com
[Accessed 20 February 2020].

Kummer, C., 2008. Strategic HR Review. In: "Motivation and retention of key people in mergers and acquisitions",. PricewaterhouseCoopers, Zurich, Switzerland and Webster University: Emerald Publishing Limited, pp. Vol. 7 No. 6, pp. 5-10.