Miller’s Monday Morning Message
presented by ACM Consulting Inc.
Andrew Miller on operational excellence, strategy, life balance and everything in between
Toronto – February 18, 2013
With the news of two major acquisitions over the past two weeks, we see a flurry of activity beginning. With the purchase of HJ Heinz Co. by a group of investors led by Warren Buffett, and the “merger” between American Airlines and US Airways, here are some key tips that organizations should remember when embarking on a potential merger or acquisition:
- The whole must be greater than the sum of the parts – This means that the combined organization after the deal must be better off than the individual companies were before. Too often these deals become just about cutting costs and not improving operations or increasing innovation.
- Determine which culture will prevail – Each company has a different culture, and one of them has to be chosen. Despite the use of the word “synergy” only one company culture can prevail (usually the larger company, frankly). In the merger of Canadian Airlines and Air Canada, we saw the absence of a clear culture decision and it took years and many unhappy customers for this deal to work out.
- Develop an integration plan – Once you have identified the clear benefits of the merger or acquisition and the culture that will prevail, develop a plan that aligns with those decisions. Identify ambassadors from all levels of both organizations in order to help make the transition easier for employees and customers.
- Don’t rely on existing people – If the people in your organization have never been through a merger or acquisition, why would they know how to approach it? Bring in outside support with successful experience leading people and companies through this kind of change.
“The key to making a merger or acquisition work is to ensure the people in both organizations know what is happening” says Andrew Miller, President of ACM Consulting. “Too many of these deals fail because the executives focus on upper level integration and forgot about the anxiety that all of the other employees are feeling.”
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