Did you know that according to a recent Harvard Business Review report and collated research, the failure rate for Mergers and Acquisitions sits between 70 – 90%? The failure rate is astronomically high—but, why?
When considering the many factors of a M&A, such as delicately balancing each companies unique culture, mission, behavioral traits, and goals, as well as the complex cross-border IT infrastructure, financial regulations, and corporate policy, it’s not difficult to imagine why many mergers result in failure. Without employee buy-in, open communication with stakeholders, company engagement, and strategic planning, companies slip blindly into the 70 – 90% failure rate.
Dr. Chérie Carter-Scott has over thirty years of experience with successful mergers and acquisitions. She knows that when employees are not engaged, companies fail. There are eight key drivers that create a climate for employee engagement:
- Trust and integrity
- Nature of the job
- Line of sight between employee and customer performance
- Career growth opportunities
- Pride about the company
- Co-workers/Team members
- Employee development
- Relationship with one’s manager
When these eight key drivers are missing, whether or not the company is involved in a merger and acquisition, the company will most certainly have disengaged employees with low productivity and a lack of motivation. This is not good for the success of any company, much less the success of a merger and acquisition.
The reason this is important, is because the problem many companies face when involved in a merger and acquisition, is that they listen to investors rather than focusing on the people within their company. There is a clear financial benefit for two companies when a merger takes place. However, if an employees’ needs go unnoticed and their work undervalued, employee turnover takes place, which results in unexpected hiring and training expenses.
Dr. Chérie is the M&A expert you need to help your company facilitate the Five C’s of Mergers and Acquisitions:
- Care: Changes are difficult. Dr. Chérie understands that how you react to others feelings and emotions can make all the difference.
- Communicate: M&A spawn rumors. The key is to communicate throughout the process and squash any rumors and theories that may rear their ugly heads. If you’re communicating with both sides, you’re providing transparency throughout the process.
- Compensate: If you have valuable employees that you don’t want to lose, be sure to compensate them appropriately and let them know they’re valued.
- Collaborate: Mergers and Acquisitions bring together two separate cultures and a variety of personalities. Collaboration can, at times, prove tedious. ICF Master Certified Coach, Dr. Chérie, is an expert at seamlessly and creatively bringing people together to produce extraordinary results.
- Cut: Unfortunately with every transition, cuts have to be made. Dr. Chérie understands that it’s better for everyone when the band-aid is torn off quickly and carefully. Terminating employees, management or otherwise, is never easy. Let Dr. Chérie assist you with this dreaded part of your M&A.