Australian Financial Review: Keeping employees informed during deal process

Companies entering into a merger or acquisition should start developing a change plan for their employees at the same time the deal is being negotiated and should not sugar-coat bad news, workplace experts say.

Anthony Mitchell, chief potential officer at strategic leadership firm Bendelta, said too often businesses were caught out by failing to prepare adequately to guide employees through the change.

“Too many companies think about the change plan late in the piece,” Mitchell said. “The change plan should be developed in parallel with the sale decision.

“As soon as the sale looks likely – and well before it is confirmed – there should be a change plan being finalised. This may mean that work on the change plan started months in advance of announcement.

“The simple fact is that well-planned change processes go better than when they are made up on the fly. A good change plan will be clear on the objectives, identify the likely reactions and concerns, have answers to most questions already worked out, and include a multi-channel two-way communications strategy and timetable.”

Mitchell said it was important that company leaders were able to answer the fundamental questions honestly and clearly, and that employees were given multiple ways to access information and ask further questions.

Reduce stress levels

After the deal is announced, it should be executed as quickly as possible, Mitchell said, to reduce the amount of stress for employees and mitigate impact on productivity and morale.

“Many employees may be initially wary or worried, even if the sale is a good idea and in their best interests,” he said.

“This is because surprises trigger primal threat sensors in our brains. If things suddenly feel more uncertain, or if an employee feels that they may lose their status, work relationships or employment benefits, they will start to act as though they’ve been attacked – leading to fight, flight or freeze responses.

“While the senior executives may be thinking about the new business venture, other employees may be preoccupied with questions ranging from ‘where will my desk be?’ and ‘what will my title be?’ through to ‘I wonder if now might be a good time to go travelling?’ or ‘I wonder if I can get a big redundancy package?’

“It’s important to understand that employees may be operating in very emotional ways, and thinking much more about ‘what’s in it for me’ before they can focus on what is happening for the company.”

Aaron McEwan, HR advisory leader at Gartner, said the guidelines for a successful change plan were the same regardless of whether the deal was good or bad news for employees – and that communicating the changes clearly without unnecessarily sugar-coating them was important.

‘Create positivity’

“If you think about how much effort we put into building positive messages, almost all of our intent when something like this happens is to create positivity. The reality is that whenever you go through a merger or acquisition, people are impacted. They’re impacted deeply,” he said.

“The important thing is that they get it and understand it. Employees aren’t stupid, and so they don’t react well when we treat them that way. So the best advice we have for companies is to be honest and transparent about what’s happening and what’s coming next.

“As long as employees understand the goal of the change and it has been clearly articulated to them – even if it has negative consequences – it doesn’t impede their ability to get on board.”

Having studied hundreds of companies in transition, McEwan said another of his findings was that the employees most able to make changes a success were not always the company leaders.

“Leaders aren’t always best situated to make the change process smooth and effective. If leaders are responsible for change implementation, it’s actually more likely to be unsuccessful,” he said.

“What you want to do is engage key employees that are closer to the organisation, closer to the customers and closer to the work that’s being done.”

Clear goals

McEwan said while it was important to have a change plan, it was also important to realise it should not be set in stone and be open to adapting it as the situation unfolds.

“A clear goal matters more than a perfect plan,” he said. “We live in the age of disruption, plans are definitely not permanent.

“No-one would have predicted Trump or Brexit. So when you go into a merger or an acquisition, having a clear goal about what you’re trying to achieve is the most important thing. You can then make plans, but recognise that those plans are likely to change as the situation does.”

This content is produced by The Australian Financial Review in commercial partnership with Ansarada. To view the original article click here

About the Author:

Anthony Mitchell is the co-founder and Chief Potential Officer of Bendelta. He is an internationally recognised thought leader in strategic leadership. He has been advising companies internationally for the last 25 years, working across more than 30 countries on five continents advising clients ranging from leading multi-nationals and listed companies to major government agencies and not-for-profits.

2017-11-20T17:02:44+00:00 November 8th, 2017|