4 Guidelines on How to Survive The Mergers & Acquisitions’ Train Wreck

There are more mergers and acquisitions (M&As) taking place now than ever before. For employees, this is often not good news.

That’s because a lot of things can go wrong during an M&A.

But there is a way to avoid this and create a healthier experience for those involved – by following some important guidelines.

First, some background.

Many of these M&As are happening because large companies are increasingly discovering that it’s easier to buy market share through mergers and acquisitions than to gain it organically.

All too often, these M&As are essentially like train wrecks. In the aftermath, people wander around confused, disoriented, scared, emotionally vulnerable, frustrated, and often angry.

Even though many may suggest this analogy is too exaggerated, from personal experience, we know it’s unfortunately true.

It’s why so many M&As end up with frustrated employees, lost productivity, unnecessary turnover, and lots of finger pointing about who’s to blame for what went wrong.

One of the main causes of this is that anything which messes with our safety and security (such as our jobs) pushes us quickly into emotional survival, which leads to fear and defensiveness that can really hurt people and the merger, if not handled properly.

So, why do these “train wrecks” keep happening? And, what can you do about it?

Mostly, they happen because people ignore some important guidelines.

Management genius Peter Drucker wasn’t a big fan of mishandled M&As either, so he outlined 5 Rules of Successful Acquisitions  to help businesses avoid train wrecks.

We are big fans of Drucker, so with great respect to his legacy, we’d like to add 4 more that will help everyone involved survive and minimize the punishing consequences of the train wreck in an M&A.

In an M&A, there are Four Guidelines to remember:

1. Assume Nothing

2. Communicate, Communicate, Communicate

3. Assure, Assure, Assure

4. Be Clear and Consistent

Here’s how this works…

1. Assume Nothing. This is important because in an M&A, as the dust settles, everyone in both companies goes back to square one.

In other words, no matter how well things were going for you before the merger, it’s now like a brand new company starting from “scratch”.

So, don’t assume that anyone in their assigned task at any level is “fully”competent – unless you have seen them do the task at least three times – from beginning to end, to your satisfaction, without supervision.

Over time, things will slowly return to normal as everyone learns how to migrate their existing skills from their current function (before the M&A) to become competent in the “new” job  (function) assigned to them in the newly formed business entity.

Until then, don’t assume anything.

2. Communicate-Communicate-Communicate.  Because of the previous point (“assume nothing”), it is essential to triple or quadruple the frequency of communications (this includes meetings) at every level of the organization for the first 90 to 180 days.

This applies especially to meetings informing all staff about how things are working, integrating, not working, not integrating etc.

These meetings, at all levels, need to allow people to voice their concerns, fears, opinions, conclusions, and suggestions in an unconditionally accepting, psychologically safe environment, without fear of judgment and/or punishment.

This feedback is critical because, in times of stress, when people are looking for feedback and they don’t get it – they usually create their own and, human nature being what it is, the feedback is usually negative.

This is not good for the person or the company.

3. Assure-Assure-Assure.  Because of point 2 (“Communicate”), it is very important to help reassure people by properly contexting everything that is happening around them.

It’s important to reassure them that even though the current time is stressful and appears unsure, things will work out well in the near future and going forward.

This is particularly important for leaders, managers, and the executive to communicate.

It is essential that they constantly make these assurances to everyone they interact with – everyday.

This means not only formally but informally as well: in the hallways, washrooms, kitchens, cafeterias, parking lots, in and around elevators etc.

The assurances have to made with sincerity and honesty and will go a long way to defuse and reduce everyone’s stress and uncertainty.

4. Clarity and Consistency.  Clarity and consistency are two of the most powerful things managers and leaders bring to any given situation and it remains true with M&As.

It is critical that all leaders, managers, and executive are aligned, clear and consistent in their messaging at this time.

They must all be saying the same thing, the same way.

They must be aligned and in support of each other at all times.  This includes never being heard or seen disagreeing with each other in public.

They can disagree all they want behind closed doors – but in public it must be one message:  “We’ll get through this – and we’ll do it together!”

This clarity and consistency must wrap around the first three points above at all times.

If you follow Peter Drucker’s 5 decision criteria when considering an M&A and then implement the 4 guidelines above once the M&A is in motion – it will go a long way to mitigate the potential damage and help ensure that the train wreck doesn’t last long and has fewer casualties.