Strategies for Managing Employees During M&A

Whether you’re selling or buying a Dallas business, thoughtful management of employees during the M&A process is critical to the success falling. Many deals fall apart because of integration failures and cultural clashes that the c-suite never anticipated. Success begins with the people who oversee daily operations, who have the power to make or break your business—your staff. Learn how to keep them happy and working hard as you pursue your next investment banking deal.

Identify Key Players

A plan for managing the new business’s team begins with identifying key players on both sides. While managers are important, often the most important people don’t have a title reflecting that importance. The administrative assistant who’s been at the company for 30 years may have key institutional knowledge and decades’ worth of relationships that are key to making the deal succeed. Ask your team who is most important to their work, as well as their most trusted colleagues. Then begin developing a list of the people you most need to stay on board and commit to assisting the transition. Armed with this list, you can identify a role for each key player.

Incentivize Your Team

People work for pay, and most workers want as much control over their lives and appreciation for their work as possible. You should not assume that your team will stay on out of company loyalty. If you do, it’s very likely your team will seek to leave as soon as they get a better offer, because mergers breed uncertainty and uncertainty chases away workers.

Instead, meet with each team member individually to discuss the role you would like for them to play in the new company. Then incentivize them to stay on board with a raise, extra benefits, more autonomy, a promotion, or all of the above. Put your agreement in writing so that your investment in your team pays off after closing. Otherwise you might still deal with staff jumping ship at the last minute.

Devise a Comprehensive Communications Plan

The way you communicate the merger to your employees will set the tone for the entire process. You can choose to let the rumor mill do all of the communication work for you, or you can offer clear, specific, actionable information from day one. Identify clear goals for communicating, as well as which information will be most important at various stages of the merger. Then commit to an ongoing process of transparency, with regularly scheduled town halls or Q&A sessions tailored to the needs of your team.

Plan for Integration

Post-merger integration can be stressful for everyone, especially employees who must deal with cultural changes, new managers, new colleagues, and possibly new responsibilities. Integration planning should begin well before the deal closes. Larger companies need a dedicated integration team with members from both businesses. Solicit input and feedback from employees, and treat their opinions as important. They are a major factor in the success of the merger, so keeping them committed to the mission is foundational to a thriving post-integration company.