Integrating Staff During Mergers and Acquisitions
When a business is acquired or two companies merge, employees often feel anxious and unsettled. They don’t know what changes to expect and how the new situation will affect their job role and security. Usually, employees experience two types of change during acquisitions or mergers.
Firstly, the company culture changes, so they might have to get used to a new leadership model, values, working norms, and management practices. Additionally, the way the company is organized and run is altered, which means that workers’ roles and responsibilities often change. They might have to adapt to a new organizational structure, and they might no longer have the same decision rights as before.
To make the transition easier, business leaders must focus on clear communication, collaboration, training and development, and regular opportunities for feedback.
As early as possible after the transaction closes, establish clear communication channels so all employees are informed at every stage of the process. You could hold regular meetings that are open to everyone, set up webinars, or send out newsletters every few days. Setting up a committee with representatives from both companies can be another way of fostering collaboration between employees and the leadership teams.
Giving your employees the opportunity to ask questions and provide you with feedback is invaluable. It helps them to feel a part of the process, which makes them more likely to adapt to the new situation. They are prepared for the changes ahead, and they no longer feel so anxious about the transition. Additionally, they feel valued, and they are likely to be content after the transaction
As soon as possible, introduce employees from both companies to each other and foster collaboration. Initially, you might set up team-building exercises, social events, or retreats to help people to get to know each other. Make sure that leaders from both companies attend these events because this demonstrates their commitment to the merger or acquisition.
Later, you can set up projects with members of different teams to encourage collaboration. This helps to reduce the risk of organizational silos which operate independently and don’t share information effectively. Use online communication tools to encourage interaction between various teams. This allows employees to work together across teams and locations and creates a more cohesive organization.
Direction from the Leaders
The leaders of both companies set the tone for the merger or acquisition. That’s why it’s crucial to spend a lot of time planning and determining the values and goals of the new business. If all leaders understand the deal’s business rationale, it’s easier for them to present the new situation to employees. In particular, cultural issues should not be neglected because a good company culture is key to the success of the new company.
To prevent issues and reassure employees, leaders must set an inclusive tone and demonstrate respect for all employees. Provide as much insight into the merger or acquisition process as possible. Show employees your vision and goals, so they can get on board. Clearly communicate the reason for the integration, and make sure everyone understands its benefits.
Training and Development
Although retreats and team-building exercises are important, you can also foster communication and teamwork by organizing regular training and development opportunities across teams. In the initial stages of the merger or acquisition, these could be focused on helping employees understand the rationale and goals of the integration. The more people know about the new company, the easier it is for them to integrate and accept the change.
Later on, training and development will focus on the practical aspects of integrating into the new organization. Employees might have to learn to use new tools, get used to a different management style, or take on different roles within the organization. Your merger or acquisition is unlikely to be smooth unless you provide opportunities for all employees to bridge the gap and build up the skills they need to succeed in the new company.
Reviewing All Policies and Perks
All organizational processes have to be reviewed during mergers and acquisitions. Together, the leaders have to determine whether to adopt a new compensation structure and how to organize the benefits. Any changes have to be communicated and explained to employees in writing, so they understand what will happen to their salaries and benefits as early as possible. Additionally, training programs or meetings might be necessary.
It’s also worth noting that the two companies’ HR departments have to be merged. If there are differences in vacation policies or organizational processes like performance evaluation systems, they have to be reconciled. When creating new policies, take into account the needs of the employees from both companies. Aim to make the system fair for everyone, and integrate the best practices from both businesses into the new organization.
Evaluation and Opportunities for Feedback
Set up a regular meeting with the other leaders and your business consultant, during which you evaluate how well the merger or acquisition is going. Evaluation is important throughout the process because it shows you what you’re doing well and where you’re failing to meet your employees’ needs. You can then take corrective measures to improve the situation.
Allowing your employees to provide you with feedback is equally important. Create an open-door policy, so everyone can communicate with you if they run into issues or would like to address a potential problem. Similarly, schedule regular appointments with your employees and provide them with feedback. This reassures them and helps them to see where they stand within the business.
Patience and Empathy
Being willing to accept employee feedback is only the first step. Make sure that you have a system in place that allows you to share your employees’ questions and comments with the other business leaders, implement changes if necessary, and respond to everyone’s concerns. It’s important to remember that every merger or acquisition is challenging for employees. Being patient and supportive throughout the transition is crucial.
How Can an M&A Business Advisor Help?
If you’re ready to sell your company or merge with another business, hiring a consultant is highly recommended. At ASA Ventures Group, we have not just helped small and medium-sized businesses with their mergers or sales, but we have also been business owners and gone through the process ourselves. This makes us the perfect partners because we understand the process in-depth.
When you reach out to us, we’ll start by evaluating your company’s strengths, weaknesses, and needs. Then, we’ll put together a strong marketing package, so your business stands out. Because we have a lot of connections in the industry, we’ll help you to find and vet potential buyers. Once a decision has been made, we’ll support you as you go through the process.
During mergers and acquisitions, leaders have to work hard to integrate staff into the new organization and prevent interpersonal problems. Some of the most important aspects of staff integration are open communication, collaboration, clear direction, and regular opportunities for feedback. Reach out to us at ASA Ventures Group to speak to an experienced M&A business advisor about your upcoming merger or acquisition.