After over 100 podcast interviews, we have collected over 40 lessons learned from top practitioners worldwide. And in those lessons, we saw a recurring theme , creating a better people experience in M&A is key to a successful transaction. So how do we do it? Let’s all learn from the HR expert, Klint Kendrick, Chair of the HR M&A Round Table.
“Think about the people as early as possible, and apply an appropriate level of effort and attention to make sure the people-side of things are taken care of.” - Klint Kendrick.
The first step to creating a better people experience is understanding the target company’s culture and your own. You cannot bridge the gap between two cultures if you don’t understand them in the first place, and the leaders on both sides should be involved in this. HR should not be the only one in charge of cultural assessment.
Also, HR alone is not enough to deliver a better employee experience. HR needs to partner with other functions, such as IT and finance, to provide the tools that they will be using. Everyone has to participate when dealing with culture.
As an acquirer, you need to have a clear vision of what you want to do with the target company post-close, which helps create a better people experience. If you know how they currently operate and what your end goals are, you will understand the risks of moving them from point A to point B.
Also, this will help you identify the key people you need to retain. If you lose key people, you lose a lot of value in the deal.
Communicating your intended vision with the target company is in your best interest. If you can tell them your plans to take care of their business, they will be more cooperative.
This is also an excellent time to communicate your non-negotiables. If you know that a change will happen, even if they won’t like it, disclose it as early as you can. It gives them more time to process it and accept all the coming changes.
“When acquiring employees, you don’t want to just buy their hands. You also want to win their hearts” - Klint Kendrick.
No matter what steps you take, your newly acquired employees will leave if you don’t have empathy. Remember that the incoming employees didn’t choose your company and probably don’t know anything about it. You need to be mindful of all the uncertainties they are facing.
The best thing that you can do is answer all their questions immediately. Job security and compensation changes are usually the very first things that they will be concerned about. Remember that a happy workforce is a productive workforce and a productive workforce is a profitable workforce.
Dealing with this change is one of the most challenging things an employee will face in their careers. So it is crucial that they only go through it once. Integrate as fast as possible and introduce all the changes you will be making from the beginning. It is far better to be in one long period of change instead of short but multiple changes.
If you constantly change the environment they are working in, they will be in a constant state of turmoil. They will not be productive, and they will probably end up leaving.