Mergers, Acquisitions and Restructuring

The challenges of Change: Managing the People side of Mergers & Acquisitions

In today’s competitive marketplace, mergers, acquisitions and corporate restructures are among the fastest ways to increase market share and stakeholder value. This year, PWC’s Annual Global CEO Survey reported that US CEO’s anticipate an increase in M&A activity, with 42% anticipating a domestic acquisition.

Despite the projected growth, research shows that up to 90% of mergers and acquisitions fail. According to a Marsh, Mercer, and Kroll survey conduted in collaboration with the Economist Intelligence Unit, the “two most significant transaction issues faced today” are “organisational cultural differences and human capital integration.” Simply put: organisations fail to understand and effectively manage the people side of these business transactions.

The impact of the People Side of M&A's - Click to download

The impact of the People Side of M&A’s – Click to download

By using workforce analytics to identify the precise differences between cultures or teams, leaders can uncover potential points of friction that can threaten success and maximise the points of connection to accelerate synergy.

Results from our own survey research on this topic reveals 83.3% of respondents overwhelmingly agree that understanding how leadership will communicate the vision is the most important aspect of a successful corporate or departmental restructure. Of secondary importance, respondents said employees must understand the similarities and diff

erences of the two leadership teams and cultures.

A data-driven approach coupled with proactive change management planning can also help address the following critical questions:

  1. How will the new company communicate the vision?
  2. What are the similarities and differences of the two leadership teams and cultures?
  3. What will the new structure look like and who do we need in the new structure?
  4. What is the benchmark for new roles, if any? Do we have a succession plan?
  5. What organisational strengths, such as influencing skills, are necessary to manage successful change?

Managing the People Side of Mergers and Acquisitions [Video]

Managing the People Side of Mergers and Acquisitions [Video]

To learn learn more about how to leverage predictive data to manage change, read this case study: Integrating Cultures

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