M&A: Eliminating Outsider Mentality

M&A: Eliminating Outsider Mentality

Let’s face it, merger and acquisitions (M&A) are no small matter, and there are a lot of things that need to be done to make an M&A successful.  But with so many things to do, how do you organize your responsibilities?  How should these responsibilities be prioritized?

If you’re not sure how to tackle these questions, don’t worry; you’re not alone.  Many of the companies we’ve worked with have also dealt with this issue.  And unfortunately, the inability to prioritize and address key points can lead to a prolonged integration period or even cause M&A failure.  Because of this, we were inspired to create this list that will help you make your M&A successful by eliminating the acquired company’s outsider mentality.

What is outsider mentality?

Outsider mentality is the belief that someone or something doesn’t belong the group.  In the case of M&A, many companies face problems because they can’t overcome the acquired company’s perception that they are the outsider.  There is a presumption that the buying company is coming in with new approaches and regulations that will dramatically change an already-established system.  And both companies’ inability to understand each other creates a separation between the organizations, which is counteproductive and will only cause internal issues.

Prioritize Face-to-Face Time

One of the most important aspects we discovered during our work with various companies is that face-to-face time is crucial.  In order to do this, try to do things in person as much as possible.  We suggest that staff members from both parties meet within two weeks of the M&A, and then schedule regular meetings thereafter.  Not only does this help to identify key personals from both organizations, but it also builds relationships.  This bridges the gap between both companies and helps to minimize the outsider mentality.  Remember, it’s hard to be enemies with someone you can put a name and a face to.

Navigate Responsibilities 

Laying out guidelines and responsibilities is a useful way to help give employees direction.  Even if there aren’t many changes to job descriptions, it’s good to make it clear to employees what is expected of them.  This will assist them in finding their footing in the new work environment.

In addition, you should also assign a go-to person for departs or teams.  The go-to person should be someone who will help to answer any questions or concerns employees may have.  It is essential that you have very strong and capable employees in this position because this will be the bridge between you and the employees.

Be Flexible with Benefit Integration

With M&A, employee benefits may change, which could lead to conflicts if not dealt with appropriately.  Remember, people are relying on their benefits, so forcing them to change plans and start all over will have detrimental consequences that will lead to blame and anger.  Instead, allow a leeway period so employees are able to use their original benefit plan, before integrating into the new plan.  This makes your acquired employee feel that you care, and will help to help to close the gap between you and them.

Do Your Research

You should gather as much information as possible about your company and the acquiring company.  This means you should have a good understanding of how culture runs at both organizations.  Take the time to learn and understand the acquiring company’s culture, and make sure to explain your own culture to them.  Define expectations and nonnegotiables so that everyone is on the same page.  Knowing this information will only help in making the transition smoother for everyone.

Cross-Pollinate Employees

Today, cross-pollinating employees is a common M&A practice to gain a better understanding of both companies.  Pick a group of individuals who will help teach your corporate culture, as well as communicate to you the values and goals of the acquired company.  This provides first-hand insight into an organization’s culture, as well as help to eliminate the outsider mentality.  Although M&A can be done without cross-pollinating employees, it is a less effective way of integrating culture if you don’t.

Get a Process in Place

Documenting your M&A process is essential for succeeding.  Especially since M&A is so common in the corporate world, it makes the transition a lot smoother for everyone if a process is in place.  Many of the successful companies we’ve worked with have had easier transitions because they had a clear integration plan.  They knew the points that had to be addressed and how to handle certain situations due to the documentation of past M&As.  This also allows them to conduct multiple M&As at once smoothly.  And just like them, you can create a successful integration plan by documenting your process and discover what works and doesn’t work.

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