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Mergers & Acquisitions for Small and Medium Businesses:
Getting the Value Intended
Most Mergers and Acquisitions fail to reach their objectives.
Almost 65% of mergers and acquisitions don’t fulfill the financial promise intended. The cost of poor M and A’s can be astronomical and the unintended consequences disastrous in terms of customer satisfaction, cultural integration, trust in leadership and overall employee morale.
There are a few areas in business where the difference in acting and not acting is so great. The cost of a failed M or A is huge. The benefit of a successful one is equally big.
It is estimated that most business mergers and acquisitions fail not because of business aspects, but because of people issues. Most of the time, the financials are reviewed in depth. It is, however, much more difficult to gauge the impact of changes on the culture and staff. One can change things on paper very quickly and concisely. Making changes with people is a very different matter, but just as important.
The people challenges exist with public and private businesses, large, medium, and small. Medium and small firms are more vulnerable to people issues than larger firms, where people are more interchangeable; also these firms don’t have the resources to address the people issues thoroughly. Because of the more personal nature of closely held businesses, especially family businesses and partnerships, issues of control, culture and the process of change can be much more devastating when not effectively addressed.
When to address Merger and Acquisition issues? There are two primary times to focus on the people side of M and A.
• Early in the Process- before issues occur (this is best, when legally allowed)
• After the M or A- when there is an actual or potential “derailment”
The people and cultural integration issues must be clarified and openly discussed, either early on or later in the game. The earlier the process begins, the more likely both parties will move through their respective concerns, especially trust, control, and affiliation issues and move into a collaborative and successful integration. The Result: Increased productivity employee loyalty and company profitability.
Corporate Initiatives is a recognized leader in the area of cultural integration and trust building. We are Psychologists and MBAs who understand both the business and people dimensions of a merger/acquisitions. Corporate Initiatives has effectively assisted closely held firms produce the business outcomes intended by the merger or acquisition for over ten years.
Contact us to reduce the likelihood of having a Merger or Acquisition fail due to the mismanagement and misreading of the people/culture issues. Sooner or later you will have to pay the price. The sooner you engage everyone in powerful conversations, straight talk and resistance management, the quicker you will see a return on your investment.
The longer you wait and stay focused only on the strategic and financial areas, the more you will confront the inevitable realities of frustration, unfulfilled expectations, employees and management disappointment, loss of market share, corporate raiding and financial distress.
Give yourself, your managers and employees a large gift and call Corporate Initiatives and talk to us about what we can offer you as an invaluable resource. It will be an investment that will pay for itself many, many times over.
“The results have been fantastic and measurable. Our company has gone through many mergers, acquisitions and has had to deal with numerous cultural integration issues. Dr. Jackson’s programs have helped us to increase sales by as much as 48% in our core business. I would highly recommend their services.”
Gerard F. Griesser, The Trident Company
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