CLICK BELOW TO REDISCOVER HUMANITY

A DECADE+ OF STORYTELLING POWERED BY THE BEST WRITERS ON THE PLANET

Standing In The Shower, Throwing Money Down The Drain

I live in coastal New England and have a number of friends who are recreational sailors. When asked by someone considering buying a sailboat, they invariably answer, “Get in the shower with all your clothes on. Turn on the cold water so it runs all over you and throw $100 bills down the drain. If you’re having a good time, buy a sailboat.” A lot of companies treat the human resources aspects of merger integrations the same way: they throw a lot of money down the drain and then wonder why they’re miserable.

During the course of my corporate career, I participated in more than 100 acquisitions. A few of them paid a great deal of attention to integrating the acquired company, but most of them didn’t. They put the pieces together and hoped it would work out. It never did.As a consultant, I have an opportunity to help companies take a more thoughtful approach to integration, and the results are rewarding. I am working with a client in the telecommunications industry that will become a major regional presence once it integrates its new acquisition. Fortunately, they see their obligation to the employees of both companies, to the local community and to the Asian parent company funding the investment to pay careful attention to integrating the two companies properly.The outcomes of proper human resources integration are employee engagement, retention and productivity.

People feel good about being treated with respect, about having their points of view considered and about being communicated with directly and fully. They reciprocate by saying positive things about the presence of the new company within their community and by working hard to ensure its success.Those outcomes are always sought after a merger. They’re a primary reason why companies are combined, yet they seem so elusive. Merging the people comprising two companies doesn’t take magic, but it does require rigor. Doing it well is a straightforward process, but it can’t be shortchanged.It begins with the identification of both entities’ areas of commonality and difference, a step that needs to be thorough and exhaustive. This means going beyond a simple checklist – “Medical insurance? Check.” – to a full understanding of the plans, contributions and eligibility.

The more fact-finding done at this early stage, the fewer surprises popping up later. Every area affecting employees needs to be fully explored. A useful framework is to think through the entire employee life cycle, from recruitment to post-employment, to be sure nothing gets missed.After that, the next step is to create an integration plan that assigns priorities, clarifies accountability and establishes the timetable for completing the integration. Many tasks need to be completed before the deal is closed, but not all do. It is essential to know which ones can wait and which ones can’t.All this takes effort. Is there someone in HR who can model the data on various benefit and compensation plans, or does a person need to be “borrowed” from finance to do this? Have too many activities been given to a single person at the risk of creating a bottleneck? Does the responsible person have the authority to make decisions, or will the time for consultation need to be factored into the process?

For complex tasks, it may be helpful to break up the activity into manageable parts and assign them to small teams.Then, “work the plan.”  I know that is more easily said than done, but it really is that simple. Taking the time early on to do fact-finding and to create a comprehensive merger integration plan means that the people managing the merger will have the knowledge they need and won’t have to lie awake at night wondering whether they have forgotten a step. A strong integration plan will enable the key people to focus on what needs to be done to create a combined entity that is stronger and better than the parts were separately.Even my most avid sailing friends admit that there are times when they feel cold and wet and nearly broke, but when they’re out on the water on a glorious day, they wouldn’t trade sailing for anything. That’s the feeling we’re creating for employees, investors and the communities where they live and work when we bring off a well-integrated merger.

CLICK HERE TO GET TODAY'S BEST WRITING ON THE PLANET DELIVERED TONIGHT

Margaretta Noonan
Margaretta Noonanhttp://www.ngage.works
While still a senior executive at a global company, Margaretta Noonan started asking herself, “Am I All There?” After several years of exploring the topic of employee engagement – her own included; Margaretta co-founded ngage, a technology-enabled solution that creates a continuous connection between employees and managers about the issues that are critical to organizational success;. Margaretta spent 30 years in Human Resources and senior leadership with global Fortune 500 companies in the retail and professional services industries. Knowing that a company is only ever as strong as the talent inside it – in addition to ngage, Margaretta heads a woman-owned consulting business, noonanWorks (www.noonanworks.com), dedicated to working at the intersection of employee engagement / customer engagement and financial results.

CHECK FOR TICKETS / JOIN OUR WAITING LIST! It's not a virtual event. It's not a conference. It's not a seminar, a meeting, or a symposium. It's not about attracting a big crowd. It's not about making a profit, but rather about making a real difference. LEARN MORE HERE


   

3 CONVERSATIONS

  1. … Sailing… Yeah, well, I know the feeling well… What a wonderful analogy Margaretta ! Thank you. In my view, you are right, capability of “working the plan” and passion is what makes the difference, and most of all the ability to convey to others the same feeling…and people is at the center of it. Thank you.

  2. Thanks, Carol – you’re so right. Everyone talks about “our people are our most important asset” but when it comes time for a merger, the people are often left trailing far behind the financials! A really successful integration makes sure that the walk the talk of people being important…because they are!

  3. Great article, Margaretta. So often HR issues that get included in the M&A plan are those tangible items that the merger team realizes are important. So often they miss the intangibles, which is a great place (albeit hard) for HR to work. The fatal flaw in M&A seems to be the culture which looks similar on the surface, but isn’t. Simple things like the formality or informality of how deals get made can create a pretty big stumbling block.

DAILY INSPIRATION. DELIVERED.