M&A Success Comes Down to YOU, Boss

By: Kevin Dinino

 Fortune reports that “M&A activity flourished despite a harrowing election season,” and the numbers prove that while both candidates slammed “big business” on the 2016 campaign trail, corporate boards played “let’s make a deal” in the background. Dealogic estimates the value of the average merger or acquisition at $104.2 million, down from $115.4 million in 2015, but still higher than the yearly average of $77.1 million since 2000. And considering our own firm’s acquisition of New York-based Wall & Broad, and the (slightly larger) announcement of our neighbor Qualcomm’s acquisition of Dutch manufacturer NXP Semiconductors, this San Diego comms guy has got mergers on the mind. 

Taking a closer look, you’ll note that mergers and acquisitions call for careful planning, coordination and above all, timely communication with internal stakeholders, the media and the public. Here are five key communication must-dos to set the stage for a M&A success.

Effective communications in a merger or acquisition

Timing is Everything
Prior to the hallway conversations that are likely to occur after word leaks out of a potential merger or acquisition, employees need to be told that something is in the works. In other words, get the internal communications going early and ahead of schedule. If employees feel management is restraining key information from them (which could mean jobs are at stake), they will become curious, anxious and tense. Develop an internal communications timeline and document to relay the pertinent details of a potential merger or acquisition to your employees to alleviate any speculation. You’ll need to tailor the message accordingly to each key audience: employees, customers, partners and/or centers of influence. Quick tip: remember to stay on message!

Strategic and Organizational Alignment
We all know that change is hard. Members of your organization will need time and support to become acclimated to the new normal. Senior management and C-level executives may have to roll up their sleeves and engage with employees at all levels to keep business moving smoothly through the transitional period. Their key tasks should be to manage expectations and assess changes to company culture. Think of your employees as a “trigger and alert” system — signs of turbulence will often appear inside your organization first, giving you some advance notice that your communications plan needs a revamp.

Due Diligence
Cross your i’s, dot your t’s, and then send your plans to a copyeditor. You cannot be too careful during a transition! Ensure employees and shareholders are on board with all necessary regulatory authorities. Review details related to financial liabilities, contractual agreements and obligations, as well as any regulatory considerations. For example, in some cases, there may be a need to obtain specific approvals from the government or third party agencies. Additionally, understand how the labor laws are going to impact the company once the merger or acquisition is complete.

Distribution Venue
Outside the traditional means of issuing news  through  press releases, create a game plan for how both internal and external audiences will acquire the information. For example, once the key message has been distributed, consider having periodic town hall-style meetings or webinars to ease anxiety of employees and answer key shareholder questions. Similarly, social media platforms such as Twitter, Facebook, Instagram or YouTube are also viable options for staying connected with your peers. Ensure you are using the appropriate medium for content distribution whether it may be social media, email newsletters, blogs or courier pigeons.

Post-M&A Communications
The entire M&A process requires hand-holding, naturally. Senior management will be responsible for guiding post-deal efforts and alleviating miscommunication. Address employees’ critical concerns immediately: the state and security of their jobs, reporting structures, roles and responsibilities, growth plans, etc. Lay out groundwork for the organization so that not a single employee skips a beat after the deal has been completed.

Remember, the process of successfully merging or acquiring companies, depending on factors such as cultures and size, can take anywhere from days to years. Always update employees, and continue to let them know their place and how they can help make the process more seamless. Vary your mediums of communication to constantly touch all audiences and initiate engagement. Good luck in 2017!

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