Seven strategies to keep talent top of mind during the M&AÂ integration process.
By Amy Bush
This has been a bumper year for mergers and acquisitionsÂ (M&As). In fact, itâs been a record year, with $2.5 trillionÂ in mergers announced in the first half of 2018 alone.
But a recent Harvard Business Review study estimatesÂ that about 70 percent of mergers fail to deliver on theirÂ expected benefits. Now, a lot of things canâand doâimpact that experience. A successful merger isnât justÂ a question of effectively bringing together financial,Â physical, and organizational assets. The topic of talentÂ should be high on the list as a contributing factor as well.
Here are a few recommendations that companiesÂ embarking on M&A activity should consider:
1. Culture rules. When two organizations come together,Â there is bound to be a bit of a culture clash. In fact, thisÂ is one of the most frequently cited reasons for a failedÂ merger. Consider a complete culture assessment of eachÂ company to help employees understand how theyâreÂ different and how theyâre similar. Then, take the bestÂ of both worlds to create a âsuper-cultureâ that inspiresÂ people to work better together.
2. Invest in leadership. Companies should bring togetherÂ senior people from each organization to create aÂ dedicated program management office (PMO). ThisÂ should become their primary focus for the bulk of theÂ integration effortânot a job they do from the side ofÂ their desks. This kind of commitment helps ensure thatÂ both organizations are represented when assessing theÂ talent of the combined company, while demonstrating toÂ line employees that the merger has the support of seniorÂ management.
3. Give talent acquisition a seat at the table. Once theÂ PMO is in place, the question becomes: what skills doesÂ the organization need on the integrationÂ team? Itâs essential that a senior talentÂ acquisition professional is part ofÂ this group. There is a myriadÂ of talent acquisition-relatedÂ challenges that may occur,Â including a potentiallyÂ confusing employer brand;Â competing or overlappingÂ talent technologies;Â different recruitmentÂ processes; and ongoingÂ recruitment pushes thatÂ have an unclear futureÂ and have the potential toÂ derail success. At the sameÂ time, the organization needsÂ to keep the recruitment trainÂ on its tracks, doing the businessÂ of hiring for positions that needÂ to be filled right away. Someone onÂ the PMO must understand these issuesÂ intimately.
4. Make a list of âkeep-at-all-costâ employees. A mergerÂ or acquisition can create a lot of uncertainty amongÂ employees. Companies never want to lose their bestÂ talent, but this is a perfect time for competitors to catchÂ employeesâ attention. Invest some time in identifyingÂ high performers and high potential employees. MakeÂ sure leaders communicate with them regularly andÂ let them know that theyâre central to the future ofÂ the organization. Hold âstay interviewsâ to help themÂ understand that theyâre valued. And if a few depart,Â donât lose contact: They could be potential boomerangÂ candidates.
5. Got two? Pick one. Conversely, there may be someÂ employees who arenât needed longer-term. After all,Â thatâs one of the key benefits of a merger: acquiringÂ capabilities one organization doesnât have and upgradingÂ the ones that are common to both organizations. Still,Â even if someone is no longer needed in the new reality,Â HR professionals should make sure they provide themÂ with an orderly and dignified exit. Otherwise, the newÂ companyâs Glassdoor rating will feel the effects.
6. Seek help. Oftentimes, a merger will bring togetherÂ two organizations that competed head-to-headÂ just months before. To counteract the differencesÂ of opinionâon strategy, approach, tough retentionÂ questions, and so onâconsider working with anÂ outside consultant to mediate any clashes.Â The change management journeyÂ should be as smooth as possibleÂ and a neutral third party can helpÂ company leaders see the forestÂ instead of the trees.
7. Every day matters. OneÂ of the most importantÂ responsibilities of the PMOÂ is to make sure that glitchesÂ in day-to-day processesÂ donât scuttle success. MergingÂ financial and IT systems andÂ processes are often the immediateÂ focus, and so they should be. ButÂ donât forget about talent platforms.Â If candidate relationship managementÂ systems arenât integrated properly, someÂ great candidates could fall through the cracks. TheÂ organization might miss out on an employee it needsÂ who could be delivering value to the business today butÂ is doing that for a competitor instead. Whatâs more, theÂ candidate could be sharing their bad experience withÂ their social networks.
Remember this: people do the work. Whatever roadmapÂ a companyâs PMO builds for its integration and whateverÂ they prioritize, itâs vital to remember that behind everyÂ process is a set of people. Organizations need to haveÂ a talent strategy that motivates people to do theirÂ best work all the timeâbut itâs perhaps never moreÂ important than when theyâre in the midst of a mergerÂ or acquisition. This is when theyâre most vulnerable toÂ market confusion and customer dissatisfaction, and theyÂ need effective people to make sure this disruption is keptÂ to a minimum.
No two mergers are alike and some will be moreÂ difficult than others, but very few are easy. But withÂ an integration strategy that includes talent acquisition,Â businesses can set themselves up for a much betterÂ chance at success.
Amy Bush is the president of Sevenstep.