FOCUS ON EMPLOYEES TO MAXIMIZE THE VALUE OF YOUR ACQUISITON
What type of acquisition are you pursuing?
Will your acquisition be preserved and act autonomously, or will it be absorbed into your business? If it is the latter, we have some sound approaches for you. So, you have determined your acquisition will create value, you are paying the appropriate price for it, and the cultures of both companies seem sympatico. Your board has evaluated all risks, financial and other outcomes, and is in favour of proceeding.
What is your #1 consideration?
Your top consideration is to support employees throughout the transition to best protect the value of your merged entity. This process begins BEFORE the integration via an Integration Plan. A designated merger leader should be leading the integration planning process.
What is needed in the Integration Plan?
In your absorptive acquisition, fast consolidation is key to seeing quick gains. Internal working groups should be set up to maximize value and reduce risks:
Determine the new organizational design.
Ensure processes are clearly documented and consistent between organizations.
Determine talent that needs to be retained in the short term vs. long term.
Identify all cultural differences and minimize areas where they may conflict. Do everything it takes to avoid “us vs. them” syndrome.
The McKinsey 7-S Framework is helpful with integration planning.
How to keep employees informed and engaged
Change management principles need to be embedded in the Integration Plan to ensure focus is placed on helping employees adapt to upcoming changes as smoothly as possible.
Before the acquisition is completed:
Develop comprehensive change management and internal communications plans aligned with the Integration Plan and acquisition drivers and goals.
Identify communication channels and create new ones if required.
Employee communications need to begin the day of the acquisition announcement. Pre-acquisition communications should come from the CEO of the respective companies to their employees, be in complete alignment with each other, and signal to all employees that more information will be forthcoming.
Identify change management leads and change agents within the merged entity.
Consult employees at both companies to gather ideas and constructive feedback.
After the acquisition is completed:
Welcome new employees!
Communicate the new merged strategy, including:
A plan with key milestones
Vision, mission, and values
Err on the side of overcommunicating internally via every channel available, including emails, Q&As on your intranet, interactive townhalls, and weekly presentation materials and talking points provided to change agents.
Ensure communications are two-way. Make sure frontline supervisors are well informed, listening to their employees, and are communicating their employees’ concerns upwards.
Continue with employee focus groups and pulse surveys at key post-acquisition milestones to uncover pain points with the acquisition, areas of resistance, areas for further education or training, and to track gains.
Align individual performance targets to the integration plan and success of the new strategy so they can keep their eye on the prize.
Celebrate all wins in a big way!
An Integration Plan following McKinsey’s 7-S framework, and change management and internal communications plans, are critical to realizing the value from an acquisition. When you place employees first during your acquisition and give them the information and tools they need to succeed, by doing this your path to realizing projected value creation through your acquisition is better assured.
