Despite research showing that acquisitions and mergers rarely supply significant shareholder value, there is no sign of any slowing in the tendency toward M&A. Among the leading reasons why , tend M&A to fail, argue the authors, is the procedure which regularly places extreme stress on senior management teams. When the dust clears at the end of the procedure, management is left, as the authors say, "to navigate the challenging segue from 'tough negotiator' to 'trustworthy coworker.'" The writers draw on the experience of Hewlett-Packard, Cisco, General Electric and Adobe to propose six guidelines for enhancing relationships between the senior management teams of both sides of the M&A equation. The first three strategies should be undertaken as soon as possible in the amalgamation procedure. The authors propose that you could reduce the defection of gifted personnel by reducing part ambiguity as quickly as possible.
Due diligence is also urged by them about the ability you are getting in the process as probable, and preferably before the arrangement is concluded. Third, they recommend letting some "habits to die hard." Employees often rely on customs and long standing processes to remain comfortable, and many of them are what made the business successful in the first place.
There are three more important guidelines to follow, as the integration process continues. First, acquirers shouldn't bear "bad behavior" that can sabotage the integration procedure. Second, it's important to have patience with the new management team, as many of them will be in unfamiliar parts. Finally, the authors suggest that it's very important to remember to celebrate the worth of the deal for all concerned. By proclaiming the value of the new team, you can raise communication and trust. Finally, this trust can result in increased shareholder value for all.
PUBLICATION DATE: October 01, 2008 PRODUCT #: SMR295-PDF-ENG
This is just an excerpt. This case is about LEADERSHIP & MANAGING PEOPLE
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