It’s no secret that mergers and acquisitions can cause anxiety throughout an enterprise. Departments are often shuffled, cultures may clash and employees sometimes fear that new talent will threaten their roles.
Mergers, acquisitions and divestments have become increasingly common across industries. The Deloitte 2016 M&A trends year-end report found that 75 percent of business leaders expect deal activity to increase in the future, 64 percent expect deal sizes to increase and a virtually-unanimous 99 percent anticipate industry convergence to be a continuing trend through 2018.
But M&A shouldn’t be viewed as a recipe for chaos. As intricate as the process might be, it can also present an opportunity to realign on business strategy, reinforce culture, and discover new synergies among the teams and individuals who drive innovation and business goals.
What’s the key to a smooth integration? Learning and development. An effective change management strategy gets new employees up to speed quickly and aligns leaders on goals, all while keeping everyone engaged with as little disruption as possible.
When it comes to managing change, here are the three most important learning and development touchpoints:
You don’t have a second chance to make a first impression. The same goes for acquisitions.
Establishing a positive employment brand is vital for the acquired and acquiring companies, making all employees feel comfortable with their place in the new scheme of things. The sad reality is that onboarding is often just a data dump or a pile of paperwork. With so much content available, learning leaders need to become curators rather than creators. The focus needs to shift to arranging relevant pieces of content in a meaningful manner, providing value-added insights and creating an optimized learning experience that is personalized to each employee.
Rather than treating onboarding as a one-time event, we should think of it as an extended process of assimilating people into meaningful citizenship, cultural alignment and operational effectiveness. One way to do this is through “stay interviews.” As opposed to retroactive exit interviews, which do nothing to affect an employee’s decision to remain, managers should periodically meet with employees during the onboarding process to discuss successes and pain points, which provide insight into overall engagement and retention efforts.
A robust onboarding process can also mobilize a carefully targeted re-recruitment effort designed to identify flight risks, reduce fear and uncertainty, ensure that key players feel valued, and cast the newly merged company in a favorable light. The Deloitte 2017 Global Human Capital Trend Report found that fewer than one-third of millennials believe their organizations are using their skills well. With the unemployment rate currently at 4.2 percent, the market is ripe for employees to seek jobs elsewhere, so vocalizing learning and career development opportunities at all levels is critical to keeping employees engaged.
2. Leadership Development
Immediately after an M&A event, companies have a very small window to show return on investment to the remaining employees. Outside recruiters will often use a merger or acquisition as an opportunity to poach your talent. According to the ADP Research Institute Evolution of Work 2.0 study, 46 percent of employees would consider a job that offered the same wage, or even slightly less, due to a lack of a personal connection with supervisors. Therefore, it’s critical to develop leaders and ensure they can properly coach employees, provide feedback and assign meaningful work. It’s also important to provide retention benefits, such as flexible work schedules, group incentives, training opportunities and retention bonuses.
3. Engagement and Culture
It can be tough to assess a company’s culture before a deal is finalized and the assimilation process begins. Once that does happen, HR and learning leaders can improve cultural learning for new employees by providing facilities tours so they can see what it’s like to work there. It’s also a good idea to ask the acquired company for copies of employee engagement surveys so you can see how engaged their employees were prior to the acquisition.
Why does this assessment matter? Because post-integration culture alignment can be the differentiator of a successful deal. The acquiring organization should give the new employees a sense of the parent company’s history and immerse them with its values, norms and corporate philosophy, in such a way that they do not offend. It should not come across as propagandistic or an attempt to brainwash but instead represent an honest effort to communicate the new corporate culture.
Socialization tactics will also be helpful for cultural engagement. These techniques might include a buddy system, mentoring programs, orientation sessions, Q&A meetings with senior executives or peer networking.
M&A is an inevitable reality in today’s business environment. Those prepared to be proactive in teaching and developing employees can turn a complex process into an opportunity to engage and retain top talent. According to the ADP Research Institute’s Evolution of Work 2.0 study, nearly half of employees are passively looking for new jobs. Don’t let M&A be the trigger for them to start actively looking. Rapid engagement and post-integration cultural alignment using learning and development can be the keys to ensuring retention success, both today and down the road.