Purpose and culture will help get your best talent on board, but it is the actions and behaviors within the organization that will keep them there.
5. Choose leaders who embody the new culture
Being intentional in articulating the organization’s purpose and culture also requires that boards consider leadership choices that align with those critical elements in business success.
Often, there is a temptation to select a balance of leaders, representing each of the merging organizations. This only works if these leaders understand the vision and skills that align to the new entity. Deals fail when leaders cannot or will not adapt to the new organization, favoring the “old” pre-deal ways. Inevitably, they are unable to meet the new challenges, and equally important, unable to inspire others to do so. Frustrated by this leadership dissonance, key employees leave and a cascade of departures usually follows.
The key for boards is to emphasize the need for leaders to be champions of connections across silos and functions and of the collective cooperation that will give rise to new innovations, efficiencies and improved customer experiences throughout the new organization.
When boards prioritize people, human potential can soar
Under constant pressure to deliver against a wide array of financial performance metrics and to meet synergy targets within 12-18 months, executives rarely have an appetite for discussions around culture and workforce engagement. They may ask, how can we afford to spend time talking about culture and interpersonal connections when we have hard targets to meet?
And yet the numbers don’t lie. Deals fail because organizations are paying insufficient attention to workforce engagement and cultural integration. A staggeringly high number of CEOs are fired. Talent investments are squandered. With so much riding on these deals, the question they should be asking is: how can we afford not to?
When boards prioritize employees — through purpose, culture, leadership and connections — and deploy technology and automation as tools to support their capabilities, that’s when the true human potential for agility, creativity and innovation can soar, and integrations can realize their full impact. And organizations can achieve the synergy targets designed to chart a new course for growth.
Summary
Despite healthy market conditions for mergers and acquisitions, a shockingly high percentage of deals fail to achieve the synergies they had promised. Boards that prioritize employees and culture during their acquisition integration may be better positioned to hit their post-deal targets.