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According to a report, between 70% – 90% of all business M&A transactions fail. A failed integration of two company cultures can cause critical talent to feel unmotivated, which will prompt them to look for jobs elsewhere.
This is where both companies’ human resources departments (HR) are critical. When they arm themselves with knowledge, tools, and insights, they can smooth over the process for employees, which will make the M&A a better experience for all.
Here are a few tips to ensure the M&A process goes smoothly.
1. Have HR Visibility – When an M&A transaction is announced, there will inevitably be many questions from employees. Make sure your HR professionals are involved in culture-related questions from the start of the M&A. When HR has knowledge of the company culture, the person-first considerations will be handled immediately, rather than later. It is HR’s priority to make sure employees feel secure and heard during the transition, and when employees know HR is reliable to turn to, lots of uneasiness will be alleviated.
2. Create A Culture Task Force – Assembling a task force specifically to get the two work cultures to mesh should be prioritized. In the month/weeks leading up to a merger, HR professionals from both companies should come together to discuss their new workflows. Once the transition occurs, the task force should be helping to onboard employees and communicate the changes as soon as possible.
3. Conduct a Review – It is important for any company to review its company culture and related documents, but it is especially critical when merging two companies. A thorough review of the incoming company’s structure, culture, and employee documents should be conducted with HR professionals and company leaders on both sides. From there, the newly merged company can restructure their documents and take into consideration policies that work and those that do not.
4. Learn from Incoming Culture – When a new company is acquired, it is important to integrate the new offerings, clients, and core competencies. Get to know what your new employees enjoy from their old company and move it forward. Try to learn from their way of doing things to make the incoming employees feel more at home in the newly merged environment.
The Human Resources Department certainly has a full plate when it comes to mergers and acquisitions, but it is possible to have a successful process when company culture is prioritized.