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Top Ten Things You Should Know About Mergers & Acquisitions

Numerous research studies conducted suggest more than two-thirds of all mergers fail due to lack of planning and communication.  Although products, technical ability or service may be the underlying reasons for a merger or acquisition, the human side of the equation is a key element in success or failure.  Here are the top ten things you need to know about mergers and acquisitions that can facilitate a smooth transition.

1. Make the right first impression.  You only get one chance to make a first impression, so from the beginning, plan how you will present your organization to the newly acquired staff.  This will help manage attitudes and expectation.

2. Budget time for people.  In the first few weeks, forty percent of your time should be allocated to staffing and people issues.  Companies should remember that its people produce profits, represent the company and their products; and are ultimately the ones who make the merger a success.

3. Plan, plan, plan.  Managers should start planning the integration of a merger before the deal is signed.  Once that occurs, companies either fail to carry out the integration plan or take too long.  The key is a disciplined merger integration plan and speed of execution.

4. Communicate, communicate, communicate.  You cannot communicate enough.  Make sure it is done clearly, consistently and frequently.  Dispel rumors, give progress reports, explain decisions and the reasons behind them.  It is important to communicate with customers and suppliers as well.

5. Appoint and empower a transition team.  Give these people power to make critical decisions and make sure their authority as leaders is recognized.

6. Establish and facilitate respect.  A merger will not be successful unless the employees of both merging organizations respect the customers, the products and the markets, as well as the people of the company with whom they are merging.

7. Continue best practices.  Identify and transfer the best practices from each company and integrate them to the newly merged firm.  There is no use spending time and energy to create new practices if effective approaches already exist.

8. Move quickly.  Making timely decisions and prosecuting coordinated initiaties with speed will reduce uncertainty.  Don't avoid making tough decisions.  Implement and abide by those decisions.

9. Don't mix mergers and upgrades.  Mergers can be seen as an opportunity to do a sweeping upgrade of the company.  Don't be tempted.  Increasing the amount of change increases the risk of failure in an unstable time.

10. Keep customers in mind.  Since integration is inwardly focused, keep an eye on sales and service.  Make decisions based on how internal as well as external business processes will be affected.  Also, don't forget to inform customers and suppliers of the corporate changes to avoid confusion.

In the business world, a successful merger or acquisition that follows a careful, disciplined plan can be a beautiful thing.  St. Aubin, Haggerty & Associates is experienced in working with companies to develop and implement comprehensive merger and acquisition strategies that address culture gaps, decision making and human capital strategy.  Together we can make your acquisition, merger or integration a thing of beauty.

For more information, please Contact us or call 847-564-2840. 

© 2007 St. Aubin Haggerty & Associates, Inc.

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