The recent flurry of merger and acquisition activity around T-Mobile and Cadbury suggests the big deal is back in. What does this mean for the people in those companies? Historically, big mergers have been precarious at best, with many such alliances mired in integration challenges, both operationally and culturally for years after the deal is signed.
As a manager, how do you weather the upheaval of a big merger? I spoke to Ravi Chanmugam, North American lead on M&A at Accenture, who suggested these tips:
There are three important things to be aware of that are occupying the minds of the top people, according to Chanmugam.
- How is the strategic management going to organise the company after the merger?
- How will they get the synergies that will make the merger a success?
- How will they bring the cultures together?
By looking at the worries of the people at the top, You can formulate your own merger strategy:
- Organisation: As a manager it’s unlikely you will have a say in the way the new company will be organised. But, who will fill the leadership roles, once that reorganisation has taken place. In merged companies there tends to be a cascading effect, so the heads of the departments will engage the next layer down. Try to identify the likely leaders and ensure your abilities are adequately presented to them? The key is in understanding the other company’s structure. Look at who is strong, who is coming up for retirement. Try to see where you could fit in, preferably with a step up.
- Synergies: When merging, the new company usually forms integration teams. Chanmugam recommends getting involved in one of those teams even though you might be taking on extra work. He says, generally people who do a good job in the integration team do well in the new company.
- Culture: Be seen as a facilitator of the integration rather than a barrier to it. Often there is an Us v Them attitude amongst the staff of the two merging companies. Understand the other company and the people they’ve employed. The more you can show that you can deal with them the better. Network with employees in the other company — if you have friends already within it, it’s time to reaffirm those relationships.
- Consultants: Even though it’s not part of the job, they are often asked to recommend key staff to the top people. Make sure you have lots of contact with the consultants brought in to support the merger. Even if your bid to survive the merger isn’t successful and you are let go, experience of dealing with third-party organisations is highly regarded by recruitment agencies.
Ric Francis, COO of consultancy EYC, and a veteran of the Safeway/Morrisons merger, has these tips, aimed more at those doing the deal, but are just as relevant to other senior executives.
- Remember why the merger was a good idea (in terms of market opportunity, cost efficiency, operational synergies) and build the integration strategy to match.
- Make decisions quickly, early and most importantly once. Too many delays occur and benefits are lost by slow, inconsistent decisions.
Research from Harvard Business Review suggests the turnover in executive positions after a merger rises exponentially, with the attrition rate doubling for up to a decade after the deal has closed. If you can persuade your employers that you are worth hanging on to, this attrition will play to your advantage, opening up opportunities to develop your career in ways that would have been closed in less turbulent times.
