Collaboration during mergers – key considerations for success

When choosing to merge or create a partnership, the right fit is critical. However, there are many reasons why the coming together of two organisations can fail, or be more painful than it should be. When you are knee deep in due diligence it is easy to overlook some of the elements that matter most, and in particular the people. Being cognisant of the direct impact on employees is key to the success of any collaboration and should be high on the agenda.

Many organisations commonly overlook the complex employment issues that inevitably arise when they join forces.  If handled poorly, major organisational changes such as this can damage productivity, erode employee engagement, unravel previously healthy relationships with clients, and in some cases lead to expensive legal procedures. On the contrary, if handled effectively, the exact opposite is achievable. Planning and managing the people element of any partnership will always be critical to the success of a deal. This is particularly apparent where an organisation may have to navigate not only different legal and regulatory requirements, but also different organisational cultures and employee consultation challenges.

It is also important to remember that once a merger or partnership has been finalised and completed, the next phase of hard work begins. The post-merger phase is the most commonly neglected element, with employees left feeling bereft and lacking in direction or value.

With this in mind, there are a number of key considerations which may have a profound impact;

Culture

Today’s employees place far greater importance on organisation culture than ever before. In a smaller organisation that can simply mean feeling part of a team or feeling emotionally invested in the values of the organisation.  However, becoming part of a much larger partnership can irrevocably alter the flavour and tone of any organisation. There will always be elements that will rub against each other, and it takes commitment to drive cultural change, and blend different cultures together in a way which is positive and constructive, and creates a sense of belonging.

Phased Planning

Every stage needs to account for both short- and long-term employment issues. Where employment issues are concerned, detailed forward planning is a must, and requires the input and guidance of an HR specialist from the outset.

Open Communication

Effective employee communication before, during and after any collaboration is essential, not optional. These are notoriously anxious times for even the most mild-mannered employees. Employees will be preoccupied with speculation, uncertainty and assumptions. Poor communication can be a damaging to morale, performance and motivation, disrupt an otherwise smooth coupling.

Retaining key people

Strategies for retaining key people post-merger vary widely from one organisation to another. However, it is worth remembering that most employees will want assurances that the new partnership has a strong and sustainable future, offering them reasonable long-term job security. Financial incentives are certainly important, but they are unlikely to be sufficient in isolation.

Striving for best practice

The most successful partnerships will focus on more than just the legal and regulatory compliance, taking account of differing cultural expectations and sector standards in HR planning. They will pre-empt the questions employees will want answered before, during and after a merger and provide much needed answers to pertinent questions

If you require support dealing with organisational change or merger related HR matters please contact our HR Director for a confidential discussion.