Nurturing the M & A newborn

Female orangutans have to wait eight years between births - the longest interbirth time of any great ape! Infant orangutans continue to stick close to mother and even breastfeed until they are five years old – making them the species with the longest dependence period!!

The 8 Best Mothers In The Animal Kingdom by Jill Harness. (May7, 2011)

It is well known that mergers and acquisitions have a 30% success rate, on the overly optimistic side. For example, during Immelt's tenure (whom I still admire), GE made 380 acquisitions that cost $175 billion and sold off 370 assets worth a total of $400 billion. That's a lot of kids and a whole bunch of unhappy babies.

Given this daunting prospect, what are the essential ingredients that HR can help the newborn with in the early stages of infancy. In the next few steps, I will attempt to provoke some ways in which we can look at M & A integration from the lens of parenting and child rearing from the animal world.

1. The Organization as a Modern Family - The family in today's world is not only evolving in partner roles, gender mix and lifestyles but also in how families share physical worlds vis a vis private, online footprints.  In this context, it is key for HR integrators to determine the nature of the relationship of the acquirer with the acquired entity, how to migrate the different structures into a working team and promote spaces in which communication  and collaboration can take place. This can happen in several different ways. For instance, when GE announced the new management structure for GE Oil and Gas and Baker Hughes, it made early choices on who would remain a member of the management of the new family and who would be left out based on the goals for the new business.

2. Workforce with a Family Planning strategy - Just as fertility rates, population growth, birth control and planned parenthood are central to the issue of family planning it is equally critical to base workforce planning on a sound understanding of tenure, attrition and retirement rates not only at the acquired entity but also within the acquirer organization. This aspect is often overlooked since is very often, the difference between a healthy and an obese workforce. Due diligence can play a big role in gathering data not only about current demographics of the new workforce and performance but also historical rates help the new management team form better decisions on future size and composition of the workforce.  This is where strategic workforce planning for the future and not just operational workforce planning comes into play. As recently as 2015, an article by Law360 shared details how activist investors were tearing into Bank of New York Mellon, including a firm named Marcato which was alleging in a presentation to shareholders that the Bank had 10,000 "excess" employees representing approximately 20% of its workforce at the time.  

3. Cultural (un)Learning to sustain the Family:

It is important in the early stages of acquisition for management teams on both sides to quickly assimilate best practices on how to sustain and grow the business. With Wall Street and activist shareholders hungry for early returns, it is imperative that the new company learn to feed off skills and practices that help generate repeatable and respectable revenue that are vital for sustenance. For example, if the acquirer with an extensive aftermarket distribution network has bought an organization that is solely used to generating revenue through an OEM customer base, it is critical that the new baby learns to position the expanded offerings to trap new customers while retaining an existing customer base.

The young killer whale, also known as an orca is a case in point. A few years ago, ABC news featured Michael Noonan, a psychologist at Canisius College in Buffalo, N.Y.. Michael is a specialist in animal behavior was watching these whales during feeding time, when lots of gulls descend towards the same space in hopes of snatching a stray fish. a young whale decided to share part of its lunch with the gulls. What he got to see next was truly remarkable. A young killer whale was swimming with a seagull in its mouth while all the other young and older whales were left gaping with small scraps of fish in their mouth. "The whale spit fish at the surface of the pool and then sank below and waited," Noonan said. "The gull came down to get the fish, and the whale grabbed it."  It was not long before the entire community of whales of all ages were mimicking this strategy that challenged the habit of looking only below the surface to one in which a smarter bait became a magnet for a larger kill.

Knowing the critical processes of the acquirer and the acquired, while knowing which ones are redundant once the companies are combined are essential to navigate in a fiercely competitive environment.  

"Co-parenting. Its not a competition between two homes. Its a collaboration of parents doing what is best for the kids."  - Heather Hetchler (www.cafesmom.com)