Merger and Akquisitions, Metakomm

Merger & Acquisitions

According to Harvard Business Review 70% to 90% of the M&A deals don’t deliver the expected value and according to McKinsey >70%.

The focus of most deal teams is often almost solely on financials and transactional requirements but sometimes lack the focus on company cultures and talent. Many deals don’t fail because of the wrong strategic rationale but because of a clash in company cultures or poor execution of the integration from a people perspective.

A lack of quality in the integration is often the result of poor integration planning. For most businesses the critical success factors for a good integration are a well delivered culture, people and process integration. And that needs careful, early and good planning shaping the structure of the deal and first class implementation.

The investment for a good people and integration planning during due diligence will pay off during integration and will increase the chance of success to deliver the expected value creation expressed in the deal rationale.

Our experienced team can support you through all stages of an M&A deal in regards to People, HR and Organizational Design aspects. We will work together with you on looking at the core people elements shaping the design of the deal and the implementation.

Strategische Begründung Metakomm

Usually M&A projects have three distinct phases:

  • Phase 1 is from early engagement to due diligence and signing of the deal
  • Phase 2 is from signing to closing/completion of the deal (when the financial transaction is made and the ownership actually changes)
  • Phase 3 is from closing of the deal to completion of the integration (or the new agreed structural setup). This means the project is completed and the organization is going back to ‘business as usual’ mode

During phase 1 you usually have an army of external people advising and helping you through the due diligence. From a people / HR perspective you will get tons of data on headcount, compensation, policies and processes and key risks such as pension plan obligations etc. We recommend to cover the following topic areas in phase 1 prior to signing and also include the findings in the planning for the deal structure to develop a first high-level target operating model.

  • People: leadership talent, workforce composition, roles & responsibilities, skills
  • Culture: values, norms, practices
  • Structure: organization design, governance, spans, layers, locations, key processes and infrastructure

phase 2

That draft target operating model can then guide you for the work in phase 2.

Following the signing of the deal it will be possible to work out a far more detailed integration plan. The structure and content will be driven by the deal rationale and the target operating model. Obviously the integration plan will look completely different whether you are aiming for a full integration or whether the two companies will remain separate and be managed with ‘arm’s length’ principles, or whether the deal is a growth scenario or a synergies and cost saving proposition.

As part of the detailed work on implementation planning we recommend to work out solutions for the following key topics from a people perspective:

  • Culture
  • Organizational Design
  • Leadership/Talent assessments and selection
  • Change Management and Communications
  • Workforce planning – which includes key skills and key processes such as grading structures, performance management etc

These topics will be critical for a successful ‘go live’ of the joined companies as they will determine key communication aspects the colleagues in the organizations want to hear and understand. And if you are really clear in these aspects you can avoid ‘birth defects’ of the joined up businesses which would be very difficult and often costly to repair afterwards

phase 3

During phase 3 the real hard work of making it happen starts. What is commonly known as ‘PMI’ post-merger integration activities is most of the time massive workload for the teams in charge. And it consumes often almost all functions in an organization and many individuals.

The PMI work is usually organized in workstreams of which the people/HR/culture workstreams is in our view and experience one of the key ones. Because the M&A project should not fail on the people aspects due to a lack of focus on the importance of culture and the need for excellent change management.

In the people workstream the majority of the work will have to be done by the internal teams but for some areas it is possible to procure some external help and reduce the heavy workload for the internal teams. Topics we can support you with are e.g.

  • Prepare change management and communication deliverables
  • Design and facilitate culture workshops to define and deploy a new joined up company culture
  • Facilitate (or support) team integration / team development meetings
  • Design new governance structures and support implementation
  • Team and Talent assessments (e.g. using Hogan or Teamscope)
  • Process harmonization across the two companies
  • HR technology integration
  • Restructuring support

One of the experiences we have is that many companies lose the focus on the important PMI work too early and don’t follow through until the integration is properly completed, other topics take priority and attention away from project completion. We can support you in setting up a governance structure limiting this risk and work with you till full completion.

Why working with Metakomm on your M&A project?

We have hands-on operational experience from dozens of M&A deals and therefore a good understanding on what is important, what is doable, where are the key risks and how to mitigate them. We believe we are real partners for you and skilled in communication and engagements with all stakeholders, investors, C-Suite, management, colleagues, works councils.

We are looking forward to your message

Are you interested in our services, do you have any questions or would you like more information about our services? Write to us or we will be happy to call you back!

    I agree that the personal data I have entered may be used and processed for the purpose of contacting me by telephone and/or by e-mail. I can revoke my consent at any time.
    *Compulsory fields

    We use the anti spam protection Google ReCaptcha. For the correct sending of the form, please click the button "Accept cookies" in the cookie settings (found on the bottom left).

    Metakomm
    Consent Management Platform by Real Cookie Banner