An acquisition or merger can be exciting to some, but for many employees, they are a time of uncertainty, friction, and stress. We’ve seen employees question the direction of the company, mourn the loss of the previous company culture, fear for their job security, and much more. These are all concerns that can feed into retention issues, which is crucial to keep to a minimum during such a critical transition period. In order to lay a strong foundation for future success, organizations need to not only maintain business continuity but also prevent the loss of knowledge and cost of hiring that comes with seasoned employees leaving.
So how can organizations retain employees after an acquisition or merger?
In this two-part blog post, we’ll share the exact steps you can take with your internal communications to better retain employees. Specifically, in this first part, we’ll outline the three steps you need to take pre-merger.
1. Identify key stakeholders in a comprehensive communications plan.
All mergers and acquisitions have stakeholders, which are simply people with an interest in a business. For every business, these stakeholders can be broadly categorized as either external and internal ones. In all cases, we’ve seen how vital it is to put together a communications plan that accounts for all stakeholders and acknowledges their needs and concerns. Based on our experience, below is a quick breakdown of key stakeholders and the points your communications plan should hit:
- Investors: Investors need to understand the benefits of the deal.
- Analysts: Analysts need to be convinced that the deal is strategically and financially advantageous.
- Customers: Customers need to be assured that there won’t be a disruption or decline in quality in the service they receive.
- General Public: The general public can be quick to judge a merger as “good” or “bad.”
- Employees: Employees should be excited about the direction of the newly combined company and, more importantly, they need to understand their future at the newly combined company.
Within internal stakeholders, which are generally composed of the employees of the two merging companies, there are distinct segments within the workforce that need to be acknowledged and addressed. A strong communications plan will tailor messages to employees in general, high-performers, and employees at risk of leaving. For employees at risk of leaving, their concerns or frustrations should be heard. For high performers in particular, it’s crucial to show that they’re valued and have a forward career path at the future company—otherwise, it’s easier for them to leave, perhaps for a competitor, which can be especially disruptive to normal business operations.
No one can control the way that various stakeholders react to a merger, but we’ve seen that an effective communications plan will prepare leaders to easily execute, achieve their goals, and address any negative responses.
2. Identify the main milestones and align employee responsibilities in order to achieve those milestones.
A strong communications plan lets your team hit the ground running on Day 1. The plan should identify important points of progress so everyone, from top management to entry-level employees, can buy into the vision, understand what needs to be done, and accomplish it. Most importantly, all key decisions need to be aligned with the relevant communications focus and there needs to be alignment in who will be doing what, and when. In recent mergers, milestones have included announcing the deal to the entire company, announcing leadership appointments, merging specific departments together, and more.
To help you achieve this step, we suggest putting together a communications checklist that contains all possible merger milestones and identifies the most relevant ones. For example, one of the most pressing milestones may be sharing the new management structure. Creating this checklist is an effective way to give the team focus and drive so they can execute the larger plan flawlessly.
3. Create a governance process and alignment among different roles.
Setting up well-defined governance, the action of governing, is crucial to the process of approving and disseminating communications. Even the most thought-out communications plans can fall apart without solid governance. The governance process should clearly define different roles and responsibilities. When it comes to mergers and acquisitions, there are typically four roles in the governance process:
- Integration Steering Committee: This committee should review and approve the overall approach to merger communications, messaging to important stakeholders, and be the final decision maker on issues that can’t be resolved elsewhere.
- Integration Leader: This person should review the overall communications and/or activity plans, and also approve the sharing of materials.
- Communications Leader: This person should work closely with the Integration Leader to develop and execute the communications plan. The Communications Leader should also find useful resources to guide content and messaging.
- Communications Team: This team should develop and share content to the rest of the company, working closely with leaders and external partners.
What does this look like in practice? The Communications Leader and the Integration Leader work together in order to develop the overall communications plan. The Integration Steering Committee reviews and approves the overall plan. Then, the Communications Team executes the plan, drafting content at least a week in advance. When content is ready for review, the communications Team shares it with the Communications Leader, the Integration Leader, and other relevant leaders within the company. Once approved by the Integration leader, the Communications Team disseminates the content according to the plan.
Curious what the next and final three steps are in retaining your employees after an acquisition or merger? We’ll be sharing the second part of this blog series soon.
Sparrow Can Support Your Internal Communications
Does a merger or acquisition lie in your organization's near future? Ensure your new company’s success and business continuity with the right internal communications platform.
Sparrow is an omnichannel communications platform that simplifies content publishing, notifications, and analytics. Sparrow allows you to communicate with your entire workforce from the frontlines to the head office. With features such as audience segmentation, empowered engagement, and integrated channels, Sparrow will improve engagement and reach with your communication regardless of your industry, size and maturity level.
At Sparrow, we believe in the power of workforce communications and can help your business stay ahead of the competition. Book a conversation with us today.