Turnabout Is Fair Play
Last year there were more than 7,700 mergers in the United States valued at more than $1.2 trillion. Out of these, only roughly 30 percent are likely to achieve the goals that made the merger or acquisition seem like a good idea in the first place.
If the 80s were the decade of downsizing, then the 90s are the decade of merging. And much like successful redesign and downsizing projects, successful mergers must include two essential components: a strong financial / business strategy and an implementation plan for managing the human side of change.
The business press has chronicled the stories of mergers that did not meet expectations due to miscalculations on the human level - cultures that couldn't coincide; conflicting leadership styles; inadequate communication; loss of key talent - but there has been limited research into the extent and impact of not effectively managing change.
Right Management Consultants recently launched a study of 179 organizations that merged during the past few years to determine the effect of mis-managing change during a merger.
The companies in the survey ranged in
size from those with less than 250 employees to companies
with more than 10,000 employees. The study sought to
Almost all of the companies surveyed encountered problems with implementing the human aspects of the merger. All agreed that the speed of integration was critical, with some suggesting that the first six months are key. Also, more than 50 percent of the companies reported that management had failed to pay serious attention to important workforce problems.
Ignoring workforce issues has proved
deadly for many attempted mergers. The Right Management
study stresses this by identifying eight reasons mergers
The bottom-line is that companies that wish to successfully navigate through a merger or acquisition can not afford to adopt a "just do it" attitude. Instead, the key to success lies in addressing workforce issues before and during the merger.