If you’re looking to buy a company or set up a merger to dominate the market, it’s important that you follow the best practices for a successful integration plan. Mergers and acquisitions can be a challenging transition period if you go through it without extensive planning and strategy. Here is a list of some tried and effective advice for making the transition easier for all parties involved.
Top 6 Best & Effective Practices of Mergers and Acquisitions
#1. Make Internal Communication a Priority
It’s natural for employees to panic when they hear about a mergers and acquisitions plan moving forward. Understand that this is a stressful time for members of both organizations and that you need to communicate what the transition means for the employees. Be as open as possible and set up a FAQ for the employees to address their biggest concerns.
It’s especially important for you to communicate with the HR department and managers to be well informed about the changes. They are responsible for working with employees and dealing with them on a regular basis. That’s why you need to train them to respond properly and appropriately to different situations. You want the employees to feel secure and perform to their expected standards.
#2. Build a Plan for Employee Integration
Various departments will eventually have to merge. Rather than trying to react to the merge, you should plan ahead to integrate the employees of both companies. Obviously, this is challenging as the process isn’t straightforward and will need multiple iterations before a strong team forms. The point is to think about what you need from a marketing team, sales team, managers and other important parts of the company way before mergers and acquisitions are finalized.
Once this is done, you can start putting the pieces together and make changes based on results and feedback. It’s important to have your most trusted employees lead the development of the new team and make important decisions. They’ll give you the feedback on what’s working and what’s not working. They’ll be able to choose which employees are vital to your new organization and which ones may need replacing.
#3. Make Sure Your Public Relations Campaign Is Ready
If you’re moving forward with mergers and acquisitions, it’s important that you have a PR campaign ready to address the public. Tell the public why the companies are merging. Address their most pressing concerns. Communicate what the change will mean to them. The PR campaign will be important to potential customers, customers, business partners, stakeholders, vendors and any other associations. Make sure that you address each audience.
It often helps to come up with a story to communicate who you are and why the business deal happened. Also, what’s going to happen, when the changes will take place and how the changes will affect the public are other important aspects to consider. It will help to come up with white papers, videos, interviews, FAQs and other types of content. All these will make the public better understand the details of the transition.
#4. Pay Special Attention to Customers, Clients and Business Partners
The whole process of mergers and acquisitions can be overwhelming. As a result, many companies make the mistake of neglecting their customers, clients or business partners during the transition. You have to understand that the lifeblood of any business is the customers, clients and business partners. By letting them down, you’ll hurt the new brand image and damage the reputation/credibility/trust that’s been built over the years.
That’s why it’s important that you set up plans so that the transition is seamless for customers or clients. You want to communicate clearly with vendors and business partners what the change means and help guide them during the transition if you want to keep their business. Failure to do so can damage the core business and force you to spend more money on winning back the trust and relationship between all parties.
#5. Integrate the Strengths of Each Organization’s Brand into the New One
Mergers and acquisitions often happen because one organization wants a bigger market share and access to another organization’s assets (customers, locations, partnerships, etc.). One of the flaws of looking at only the numbers and assets is that the strength of the organization that’s being acquired is often ignored and lost during the whole process.
For example, let’s say the brand being acquired was known for quality products. If the organization that buys the brand sacrifices quality for profits, the whole backbone of the brand will collapse. Eventually, customers will start becoming aware of the decline in quality and will stop being customers. People will start to hear about the decrease in quality and go to competitors for the same products or services. You want to either integrate the brand identity into the merged one or fully retain and stay consistent to the acquired brand.
#6. Build a Timeline and Plan of Action for Integration of Business & Marketing Initiatives
As with any other business plan, there needs to be a timeline and plan of action for mergers and acquisitions. There needs to be a plan to coordinate the merging of the same or similar departments. Also, one must develop clear goals and timelines stated so that the newly merged organization transitions into a fully functional business that is moving towards its goals with little to no issues. Moreover, professionals must come up with an assignment given to leaders to put everything together and resolve any issues that come up.
To make this happen, the lines of communication need to be open. You should come up with some clear instructions on what the mergers and acquisitions purposes are. For example, if the merger is supposed to acquire the customer base and cross-market each organization’s products/services to maximize profit and sales, it will provide clarity for the product development and marketing department for which direction to go down and what to do next. From there, timelines and goals can be built, and progress can start to be made.
These are just some of the fundamental best practices that you should apply to mergers and acquisitions. You may find the whole transition incredibly challenging, so you need to be prepared and ready to address all the changes that are going to happen.