How often have you heard these sentiments buzzing around an office right after a merger or acquisition?

“You do it that way, but we do it like this.”

 “We may be sitting together, but you can still tell whose loyalties are with who.”

 “Yeah, they talk about us collaborating and sharing best practices, but let’s get real. They bought us, they’re going to make us do everything their way and we’ll just have to go along with it. It’s the way it always is.”

“Our two cultures are so different. I don’t think anybody gave much thought to that at all and I don’t know how it’s ever going to work under one roof.”

Admit it: You've heard them. Maybe even said them yourself. Why is it that so many mergers and acquisitions sound great on paper but as many as 90% of them never seem to achieve their full potential?

After all, it appears that you’re bringing together the best and brightest talent, resources, processes and more. Yet, you know that for all the promise that the joining of two companies can have, things can swiftly deteriorate into dysfunction in a hurry. Why?

Skepticism That It Will Work Is The Default Response.

When it comes to relationships, people don’t just “figure it all out” and get along simply because they sit near one another. There is a sense of distrust of new faces, including different management styles, that can permeate the organization (“I’m not one of his or her people, so I’m behind the ‘8’ ball already.”). Leaders can talk about new initiatives until they’re blue in the face, but if they retreat back to an office soon after, their words lose weight quickly. Above all, since there’s a track record of mergers and acquisitions that are only semi-successful at best, people know that the next one they’re involved in faces a lot of headwinds.

Because M&A transactions come with a "no returns policy," can we change this outcome and beat the odds? Actually…yes!

At Leading With Courage?? Academy, we recommend four key ingredients that form a concerted effort to bring teams and cultures together smoothly – none of which most mergers and acquisitions typically have: 

1)    Focus

2)    Intention

3)    Consistency

4)    Measurement

Let’s dig a little deeper into this mix to see what’s involved.  

Focus

The first 90-120 days after a merger or acquisition are tremendously important for setting the foundation of a new culture resulting from two organizations coming together.

It’s an opportunity for leaders to assess their goals to see that they’re on the same page and measure how engaged the team is. It’s also a crucial window in which teams and leaders can close the gaps between them and focus on mutual objectives.

So, even before you identify the tools and formats you'll use to achieve your goals, it’s our leaders who have to recognize the urgency with which to form a highly functional and cohesive team. If they see that initiative as something they should “eventually get to,” they will almost never get to it. It’s now or never. And if it’s never, the merger or acquisition will not be as successful as it ultimately could be. Period.

To address the Focus component: Identify the current challenges that lay before you and the big concerns that are already cropping up.

What processes are you lacking in order to better blend teams together? What mistakes are you seeing early on? Are there whispers around the hallways in regard to the “good old days” and by the way, why would people be saying that? As you can gather, it means being honest about where your company stands on employee engagement and the state of its culture so you understand where you have to get to in order to reach your organization’s highest levels of performance. It means seeking input on these areas from a broad spectrum of your leaders, managers, employees, customers, and suppliers.

Take these sentiments into consideration as you create a concrete, written plan to address your greatest areas of concern and define success criteria.

Intention

This is the moment of truth when plans and commitments need to become real actions. If leadership wants to follow through and see to it that the newly merged culture is going to breed high-performing teams where everyone’s contributions are valued, you will need implement assessments, workshops and coaching that involve:

• Grooming the next generation of leaders to step up and take on bigger assignments
• Strengthening relationships between and among managers, their teams, and your customers
• Energizing each person on the team to be present and focused
• Inheriting a new team successfully
• Enhancing creativity, productivity and camaraderie throughout the organization
• Improving employee morale and retention
• Building higher levels of client loyalty

To address the Intention component: Start by asking yourself three questions:

• Do you have the time, expertise, and courage to tackle the challenges that lie ahead of you?
• When you tried to do this yourself the last time, how did that work out for you?
• What's the alternative to leaving things to chance?

There are third parties out there who can help you develop and implement an integration plan. Don't be afraid to reach to them. 

Consistency

A few months into the merger or acquisition, some very meaningful plans and powerful action steps have occurred, but how do you ensure that the momentum continues towards a stronger, more collaborative culture? One thing is for certain: It must continue.

Employee engagement, leadership development and skill elevation aren't one-time occurrences. They are ongoing initiatives to the point of where they become core pieces of what drives your organization forward and are how you do business. Without this consistency, it’s far too easy for an environment to slip into complacency with the status quo and “go about the motions” of the day-to-day.

What happens next? Leaders get too comfortable. Client relationships get taken for granted. Team members aren’t communicating the way they used to. Much like exercise, these elements of a culture have to be continually addressed and enhanced. Learning and development just never stops.

 To address the Consistency component: Make a commitment to increased self-awareness, empathy and resilience. Provide coaching to managers and leaders who need to make a bigger impact, sooner. And measure and foster characteristics such as emotional intelligence, which accounts for nearly 90% of the difference between average and star performers.

 Measurement

You think you’ve done everything possible and done it right, but how do you know? Here are three popular options:

• Walk around and ask people how things are going. This will give you the opportunity to probe a little bit, read body language, and get a first-hand sense of the progress and success of melding the two businesses into one, higher-performing organization. But, are you hearing the truth? Do you feel comfortable betting on your “gut feel?”
• Keep an eye on your sales pipeline. Your experience tells you that if it remains filled, then things are going well throughout the organization. But, what insights will that provide you into the levels of employee absenteeism, enthusiasm for your new mission, and productivity and what sort of impact will those have on your ability to meet the demands of customers and other stakeholders?
• Wait to see if people leave the organization, if customers defect to a competitor, or for the P&L results. But, can you afford to wait a year for these reports? And even when you receive them, how will you know just by looking at the numbers what’s driving them or what the future is likely to be?

To address the Measurement component:  Leading With Courage?? Academy believes that employee engagement is one of the best leading indicators of the success and progress being made at integrating two companies into one. By dividing employees into two groups, acquired and acquiring companies, and then measuring their respective levels of engagement on a regular basis, you can identify what and where the integration is going well, where it isn’t, and what kind of fixes need to be applied. You’ll be able to monitor the impact your overall strategy and corrective action plans are having and fine tune things if necessary.

(Warning: a bit of shameless self-promotion lies ahead) You can create such a measurement tool and process yourself, but there’s no need to do that now that Engagement Multiplier?? (EM) is available in the US. Developed in the UK, this elegant platform allows companies to measure and visualize employee engagement by asking employees to complete an online survey every 90 days that takes just 10 minutes to fill out on any device. After establishing your company’s engagement baseline, simple, targeted action plans can be developed and implemented that will lead to the continuous improvement of this key measure of the success of an M&A transaction. Leading With Courage?? Academy is proud to be among the first authorized partners of EM in the US and by clicking here, you can watch a short video about this tool.

Focus. Intention. Consistency. Measurement. These four vital ingredients, combined with the tools, coaching, and real-world experience of third parties like Leading With Courage?? Academy, will give you the very best opportunity to form the perfect culture after a merger or acquisition. Talk to us about to find out if we’re the right hire for this crucial period of transition in your company’s history. Don’t put it off and hope all your new leaders and teams work wonderfully together on their own. Make a better culture happen by design by calling us at 312.827.2643 or email us at [email protected].