Merging anything can be complicated. And when the remit prompted by shareholders is to grow a business globally through a merger of equals, things can become especially sticky. For many, the Merger & Acquisition process fails because too much emphasis is put on the business, and the process of becoming one, that the human element (and the mammoth task of unifying cultures, leadership skill-sets, process) is completely overlooked.
Defences build up, communication breaks down, the ink has hardly dried – and there’s complete fall-out.
In this blog, we look at a few things to think about when approaching any kind of takeover, and the importance that the role of building trust plays in the greater scheme of the deal.
Acknowledge the Change
Recognising the proverbial elephant, and addressing it, will see you and your colleagues a long way to communication clarity. We’re not talking about the change that comes from merging two organisations, but rather the changes that occur through the blending of teams, responsibilities, processes. Recognising they’re there is one thing, but knowing how to address it is another. And we’ll talk about that. But fixing anything cannot be done unless you acknowledge, sometimes publicly, that they actually exist. “That is one of the reasons why analysts often ask hard-nosed questions following a merger announcement. They know that executives still struggle with proactively managing the change that comes with an acquisition, and they want assurance that the company has a solid plan in place,” says Tobias Umbeck, Bain & Company. Acknowledging and addressing the human element that comes with change is not only good for your team, but will form the ties of responsibility needed to produce past the deal – and grow into a success story.
Focus on their future
No doubt you would have gone into this deal thinking about the What’s Next. Sure, you have a strong idea of new markets, new strategies, and many would no doubt have thought about what the organisation physically looks like; expansion? executing deliver? new business development initiatives. All very topical and valuable parts of any kind of expansion plan. And we’re sure that you would also have spent a bit of time thinking about the new blended team and their individual role set out for them, and their overall contribution towards a new type of environment. So, why is the fallout so great after any type of merger or acquisition? Simple – your people feel insecure about their future. Inevitably, this ‘fusion’ often results in the implementation of new policies, procedures and business regulations which leave your teams unsure about what that looks like and, more importantly, what that looks like for them. Much has been written about ways to retain key people after any type of deal, and almost always revert back to a single point: Merit. Building a strategy based on your employees merit is more important than rank or role. Recognise their value – and their personal contribution. Build communication with them which is clear and simple (and sometimes even vulnerable), identifying their strengths (and their weaknesses) and actively formulating a plan that will help them develop their strengths and strengthen their weaknesses. Creating an environment where focus lies on the individual will stand any agreement in good stead to retain critical players to making the deal work.
Make sure you know how to keep the ship sailing
Once the consultants have left the building, and the deal has successfully been done, and you’re now left on your own to steer this new ship into unchartered waters, that’s usually when things go slightly pear-shaped. In fact McKinsey think that this is the most difficult part to any type of restructuring or reorganisation. This is also when your relationships will be tested through the need to absolutely rely on your teams to start functioning as a single unit. In fact, in the same survey by McKinsey, they noted that Mind-set changes, alignment, and clear criteria give redesign success rates the biggest boost, if done well. So, while your processes are in place, and have been tested as much as possible, be sure to also plan for when things don’t go so well by ensuring your escalation channels are clear and open – to reduce any downtime on decision-making or corrective action. You may need to tweak your strategy as you go along – and creating a collaborative environment goes a long way in re-designing the airplane mid-flight.
Creating a Team Charter
We loved this idea, shared by Nettie Nitzburg on PM360. Most of the team problems arise after a reorganisation because your team simply cannot see where they’re going. They may have been told where you’d like them to go, but speaking and believing are two very different things. Looking for any opportunity to engage and create a visible, physical plan which clarifies positioning, focus and intention is a great first-step in smoothing out the process. Which is why the idea of creating a team charter which clearly defines that, is great. Here’s what she writes. “Team charters help to define the purpose of the team, create the structure of the new team, and articulate the expected team outcomes. In this way, a team charter acts as a roadmap by which team members can see where they are headed, how they want to get there, and what directions they need to take. It can be a great way to integrate two separate teams or a group of individuals into one cohesive unit, all focused on the same goals.”