Signs of M&A trouble
By
Nick Wakeman
Dolores Ebert doesn't strike you as an expert in mergers and acquisitions. She doesn't talk about synergy or EBITDA (earnings before interest, taxes, depreciation and amortization).But after spending nearly 30 years running the Atlas Agency, a job-placement service that specialized in technology, finance and government contracting professionals, she has heard plenty of horror stories.Many senior managers and executives have come to her over the years looking for new jobs in the aftermath of an acquisition. In listening to their stories, she has gained some valuable insights into some of the common mistakes companies make in the aftermath of an acquisition. Her advice: Many of Ebert's suggestions may sound familiar, but what I find interesting is that her insights come from the people ? what many say are the most value assets of a company.People vote with their feet, so a sure sign an acquisition isn't working is when your most valuable assets start to walk.I've only touched on a few of Ebert's insights. If you want to reach her directly, e-mail dandeebert@his.com. It's a conversation I'm sure you'll enjoy.
- 1. Start the integration process early ? Have a plan in place that addresses the myriad concerns of present and new employees. A good technique is to establish committees that coordinate the integration.
2. Listen ? One of the common complaints she has handled is that personnel in the acquired company suddenly feel like they have no voice. They are not listened to. Suggestions are rejected or ignored. Senior people feel like they have lost authority and are not allowed to contribute to the direction of the company and have no say in policies and procedures.
3. Communicate, communicate, communicate ? This is a familiar refrain, but from Ebert's perspective, a personal touch is needed. Senior leaders need to reach out and take a personal interest in people. People need to know they are valued and cared about. They need to know they matter. Value new employees as much as the employees in the acquiring company.
4. Beware of competition between old and new ? This is particularly true with sales and marketing staffs. Customers don't like hearing negative comments about the new company's personnel. Jealousy and infighting can ruin customer relationships.
Ebert solution may not be a popular one, but she recommends more meetings where a clear strategy for moving forward and the role each person plays in the strategy is articulated.
5. Avoid morale busters ? One company that was acquired was very proud of its community service. Employees would volunteer as a group and do work for various charities. In their lobby, they had photo albums of their various projects. But when they were acquired, they were told the company supported volunteering had to stop. A great source of company pride was stripped away.
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