The Role of Internal Communications prior to M&A Event
In our recent article on M&As,“The Impact of Management on M&A Success: Is the Right Team inPlace to Maximize Your Company’s Pre-Sale Value?” we mention the “human factor” and the role of communications. In fact, the importance of a good communications plan and its impact on organizational culture during the M&A process deserves its own space. Why is culture so important? Because it defines how an organization is run, which is directly related to its performance.
Consider these factors as part of your M&A planning:
- The financial aspects of the M&A process typically receive the most attention, yet reasons for failure more often have to do with people and culture.
- Communication needs to happen early, and often, with allemployees – not just managers.
- It is acceptable to let employees know you do not have all of the answers to their questions, as long as they trust that you will impart the answers as soon as you have them. The absence of communication will lead to rampant rumors and negative attitudes.
- Do not give a false sense of security– be honest.
- Communications must be consistent with all stakeholders – both internal and external.
A diplomatic and open-minded approach is essential to handle the emotional aspects of the M&A process. As you assess your management team’s strengths, take pains not to overlook gaps or weaknesses in HR and others who will share responsibility with you in communicating to employees. Make sure your communication plan contains simple key messages that are shared among top management so that you present unity in communications and leadership. This will go a long way to prevent misinformation and resulting anxiety.
An interim executive inherently brings with him or her the role of the “outsider” with no personal or professional agenda, combined with experience of the M&A process. Often this combination can bring a degree of comfort to your employees as they weather this season of change, and minimize disruptions in employee productivity at a time when you need to maximize your company’s value.