Organizations are likely to go for a merger and/acquisition as a way to acquire new technology , expand into new markets, or even to neutralize competition. Mergers happen when two companies end up being under one ownership and management, while acquisition is when one company buys out or acquires another.Although mergers and acquisitions are profitable for businesses, they can also affect employees in many undesirable ways. It’s important for management to acknowledge the issues that may come about during the process, and how these can affect the performance and wellbeing of employees.
Below are some of the biggest issues faced by the members of an organization undergoing a merger or an acquisition, especially in a global setting: 1. Mergers and acquisitions today typically involve organizations that are based in different countries, which can actually make the process even more complicated.
The transfer of best practices becomes less simple because managers tend to assume that their knowledge and expertise are relevant and applicable universally. What they sometimes fail to realize is that there are many performance drivers and factors that vary from one culture to another. 2. Language barriers among participants of an international merger or acquisition are another important factor to consider.
All information relating to the agreement needs to be translated to both languages so that questions can be asked and answered right away. Employees of both parties must be familiar with the other language so that effective communication can be facilitated. 3. It’s not uncommon for the human resources personnel in companies to not be involved with the assessment of target companies before any agreement or deal is reached.
As a result, they end up playing catch-up particularly when problems with the employees arise because of the merger or acquisition. It’s vital for human resources professionals to be part of the planning and implementation processes of the merger or acquisition so they may ensure that the needs and rights of every employee is considered. Related: How to Be Mentally and Emotionally Prepared for Retirement 4. We all know that employee retention, communication, and training are all vital components of integration, and they should be taken into consideration during integration activities.
They should be customized according to the feedback from all affected employees. Communications must work well in all directions to ensure nothing is missed out. 5. Planning for the integration needs to start as early as possible.
Such plans must be in place even before the deal is closed. This will increase the company’s chances of going through a seamless and smooth transition.Mergers and acquisitions are very complicated, but they can be beneficial and profitable for a company. To ensure that employees are comfortable during the process, the management
has to do a good job of guiding them before, during and after the integration.