I ran into a friend and former colleague the other day that we will call Bill. We caught up on our families and pending summer vacations, but our conversation inevitably turned to work. His company was recently acquired and was beginning the work of integrating with the acquiring company. What struck me were the similarities in so many other stories I’ve heard of acquisition activity. It is hard work – harder than most expect for both the acquirer and the acquiree. It can turn ugly, quickly, and thus result in the loss of talent and experience if not strategically managed. And it can slow revenue growth the very opposite outcome and very worst thing that can come from an acquisition investment – if not executed brilliantly.
I speak from experience with all of the aforementioned challenges. There are, without question, very simple yet significant steps that acquiring companies need to consider to protect their new asset. This article is the first of a three-part series, focused on post-acquisition integration.
First Things First – The Current Crew
Too often, the lion’s share of time is spent communicating to and about the “new team” and less effort mapping a course for the current one. It’s not just the employees in the acquired company that will struggle with change. Absent or ineffective communication about objectives within the acquiring company can and will breed insecurity that can quickly manifest into turf wars, closed-off communication, omission of information, and quite frankly, disrespectful interactions with those who may be perceived as a threat. That, coupled with an entirely new team trying to show its value can be a recipe for low morale and underwhelming results if inward integration is not done right. Focus on nurturing, communicating and ensuring stability with your current team post acquisition, will set the tone of how they interact with your new team.
Bill spoke of an example where conflicting approaches by leadership were leading to a disconnect felt across the company. The new CEO had a great vision, was a practical thinker and understood the value of his investment. The CEO had respectful interactions with Bill, openly asked him for advice, and collaborated on decisions with he and his team. All the while, the CEO’s right-hand had a very different vision and approach. His interactions with Bill were stressed and at times degrading, and seemingly his goal was to make sure he established dominance in the situation before finding the best approach. Being in charge became more important than being right. These two competing strategies, created two messages that led to emotional collateral damage, confusion, and fear.
Why such different approaches?
Personality is one thing, but it was clear that rules of engagement from the top were not established. Most likely, the CEO’s right hand was insecure about Bill’s skills, experience, and business acumen not to mention the budding new relationship he was establishing with his boss.
Prepping your internal team, educating them on the strategic need for the acquisition and subsequently, establishing expectations for how they will conduct themselves with the employees of the newly acquired company is the first step to success. There’s no need to make promises, most companies move too quickly for guarantees and doing so can be just as toxic long term. However, it is appropriate and necessary to level set with your staff and let them know that you care about them and your new asset and that they play an important role in optimizing outcomes. The following are five simple things to implement while integrating inward:
- Proactively check the temperature of your Leadership Team by discussing the acquisition strategy. Understand who your internal supporters are, neutral parties, and negative nellies. It will be clear how you will need to construct your discussions with them for optimal results.
- Create a communication plan for your internal teams. Make sure the communication is clear, expectations are set and you do your best to eradicate insecurity.
- Demonstrate your affinity for the new company and talk favorably about the new talent and experience your team will have access to and how the collaboration between the new teams will drive results.
- Incorporate surveys regarding your leadership and staff’s ability to collaborate, their helpfulness, and their accessibility for the new team. Create incentives for great results!
- Be vigilant of personnel issues between legacy and new staff and extinguish them quickly. Don’t expect conflicts to manage themselves in this scenario; active leadership on seemingly insignificant things will be necessary for a while. Everything is a big deal for the time being.
Don’t underestimate the need to fulfill the emotional needs of your team once you have made the decision to buy a company, it will impact how smoothly your integration activities are executed. Without looking inward first, you can’t hope to look outward to a productive and successful future.