Mergers and acquisitions are complex transitions for any business entity. Contracts must be drawn up, product portfolios and value propositions must align, and once all the documents are signed, leaders still must create synergy between two disparate teams.
The changes that occur when two organisations fuse together can be confusing and overwhelming for everyone involved. Your financial team will have many compliance issues and new accounts to think about as they move into the brand-new company culture. Often, employees are left in a state of flux, unsure what consolidation means for their future and their job descriptions.
When entities meld, the result can be a higher market share, stronger operating efficiencies, and enhanced financial power. However, the transformation also encourages a host of people issues, exacerbated by the rapid pace of asset deals. It’s no wonder that the firms with the most effective communication practices are often the ones that come out on top during M&A deals. The right communication plan can eliminate issues with productivity, reduce anxiety, and maintain efficiency in a coalescing company.
Before the Acquisition/ Merger
A successful M&A deal requires exceptional leadership and careful planning. As processes involving complex organisational change, mergers and acquisitions have the power to trigger turnover, and damage business performance when they aren’t handled with care.
While any venture might see a dip in performance during the initial stages of consolidation, a strong communication plan can be the key to getting people back on track as quickly as possible. Before the merger takes place, make sure that you:
Find Your Narrative
When a merger or acquisition takes place, everyone in your organisation will want to know what’s happening, and why. The more your employees, partners, customers, and shareholders know about the nature of the deal, the more likely they are to get behind your decision. Write a plan that outlines:
- Whom you need to speak to Media parties, customers, employees, partners, shareholders, contractors, etc.
- The details of the merger: What’s happening to your company? Are you purchasing a new entity, or merging with an existing one? Will your brand remain the same? How will jobs and recruitment be affected?
- The nature of the acquisition: Explain why you’ve chosen to take this step for your company and how it will impact the people you’re speaking to. For instance, will you be able to take on more complex financial accounts with new technology? If so, will your team get the training they need to thrive in this new environment?
Choose Your Timing Carefully
Before a formal acquisition or merger takes place, your staff may start to get restless. They know that something is changing, and it’s human nature for them to feel concerned about an impending transformation. If your managers withhold information from employees for too long, the result may be reduced productivity and a feeling of anxiety throughout your company.
Develop a practical timeline for your merger and acquisition, including when you’re going to announce it to your team. Your action plan must include:
- How you’re going to communicate with your team.
- How you’ll coordinate communication between your existing employees and the business being acquired
- How updates and changes will be revealed to the company
A timeline helps employees to feel like they’re still “in the loop” during the complex process of a merger. This means they may be less likely to jump ship.
During the Acquisition/Merger
Once the two organisations begin to unite, it’s crucial for business leaders to keep their staff engaged and educated. Employees who feel as though they have the full story are more likely to support the acquisition and assist with fusion in any way they can. Throughout the merger make sure you:
Answer Questions Openly
Regardless of how well you explain the consolidation to your team during your initial announcement, there’s likely to be people in your group with questions. People who feel particularly nervous about their future with your company might want reassurance that there’s still a place for them.
Creating an FAQ that you can post on your company intranet can be a great way to get started. This will cover some of the fundamental questions about the transformation, and what it means for your customers, employees, and shareholders. For instance, you might explain:
- How long the merger is likely to take
- Whether any employees will be losing their jobs
- What significant changes will be happening to the product, service, or brand
A master FAQ document will also help to ensure that the answers to common questions remain the same between both companies so that rumours and misunderstandings don’t send the merger into chaos.
Misinterpretations are common. Mergers and acquisitions can be a stressful time for your team, and some people will need to hear the same information multiple times in various ways before they truly understand it.
Be prepared to “over-communicate” throughout the process and share any updates and new information that might come through as quickly as possible. Aside from your FAQ, you can also send newsletter alerts through email, bring teams together for meetings at the end of each week, and send printed information to employee homes. The more information your staff has, the more confident they’ll feel.
After the Acquisition/ Merger
Your communication efforts won’t stop once the consolidation is complete. According to one study, 75% of executives suggest that excellent communication is the most critical factor of a post-merger integration.
Once two companies are fused, leaders will need to think about how they’re going to combine the two cultures into one cohesive whole. This can involve:
- Issuing training and documents that help to reinforce desired behaviours and expectations
- Conducting “stay” interviews to motivate and retain key talent
- Answering questions quickly to control the rumour mill
- Hosting regular meetings to discuss issues with the merger and internalise change
In the past, M&A deals have often suffered the side effects of poor communication strategies. By focusing on your people before, during, and after your transaction takes place, you equip yourself with the people and talent you need to start your new venture on the right foot.
JobFitts Consultants are a specialist provider of professional Recruitment Services for the Financial Services sector and related suppliers in Australia. Since 2003 we have recruited and placed a breadth of operational roles at all levels from; HR, Accounting, Marketing and Customer Service/Frontline.