Mergers can cause a plethora of issues; however, there are ways to prevent many of these issues from occurring. The following six tips will help you to ensure a seamless integration.
A detailed action plan will help everyone to understand their roles during a merger. This includes all buy-in participants and employees. Detailing objectives and milestones can help manage the emotions that are often experienced during a merger. Many organizations use integration manuals or templates which include the key steps involved in a merger. One of the most important things an integration manager can do is keep the template updated with the specifics of a transaction, including key tasks, metrics, timing and personnel.
Effective and Honest Communications
Timely communication is another key to a seamless merger. This ensures that everyone involved in the merger remains up to date throughout the process, including pre-close and post-close transaction times. An internal and external communication plan should be carefully crafted. The plan should introduce the new leadership and their role in the merger. Communicate with each customer and address any of their concerns immediately. One of the most difficult parts in a merger is opening up your customer lists to the person or company that is acquiring your organization. Having contingency plans in place and communicating with your customers can help this process go smoothly. There is a potential for customer loss; however, with effective and honest communication, you can decrease the risk of loss.
During an acquisition, the operations and finance team will be responsible for the overall success the merger. Key performance indicators, known as KPIs, will be used to proactively manage the behavior within the organization. This process if often managed by the operations department using an accounting method rather than a measurement tool that defines and delegates tasks to key members of the organization.
Determine which task are the most important and reward when these critical tasks are completed. Additionally, awarding key leaders is important. Imagine if an integration leader is rewarded when their task is completed and the CEO is brushed to the side. The CEO is less likely to support the integration leader. You can prevent this from happening by ensuring that the rewards are given across the board when tasks are completed. Mergerstechnology.com suggest that virtual data rooms make this whole process a lot easier.
Integrating the Target
Once the merger is complete, the task of full integration is still not complete. Cost structures and revenue goals must be reached. Transactions involve a great deal of attention and strategizing. There will be issues that must be dealt with and handled immediately and issues that can be put on the back burner until these issues are resolved. A successful transaction includes developing a relationship with the existing management. Operational systems and accounting practices must be integrated into the new business. Old processes should be updated and the staff trained on how to incorporate the new strategies.
Understand Each Team’s Workload
It is important to understand what each team’s role is and their day to day tasks. This information will help the acquirer understand and help ensure that each team is successful. Pacing the integration process is crucial to ensure that burn out does not occur during the process and teams have equal workloads.
Another key factor to ensuring a successful merger is to use a diplomatic and strong leader who sincerely endorses the merger. The leader should embrace the key values and business practices of the new company. The organizational operatives should conform to the key business practices of the company that is buying out the existing company. This means that each team should embrace the business practices and work towards fostering a team environment.
The tips located above will help you make a merger run smoothly. By fostering a team environment, offering incentives and rewards and developing an action plan, you can help ensure the success of the integration into new management.
Note: This is a guest post.