In a wholly unexpected consequence of the pandemic, mergers and acquisitions have become a hot topic. In early November 2021, the term “merger” hit 72% on Google’s Trends index, having skyrocketed to 96 in summer.
The trends are reflected in the state of the UK economy. According to the Office of National Statistics, the value of domestic mergers and acquisitions (MA) shot up to £10.6 billion – up by more than £6 billion compared to Q1.
Indeed, UK takeovers hit an all-time high in the first seven months of 2021, with names like the National Grid hitting the headlines. Reuters cited faster-than-predicted COVID recovery and reduced Brexit uncertainty as two contributing factors. But for all the optimism around this, M&As come with their fair share of perils.
The personnel risks of mergers and acquisitions
In a 2019 article on culture change, McKinsey notes the potential risks to staff during M&As. “Even small tactical changes, like new expenses policies or cafeteria options, can rattle employees.” While M&As can be exciting, they can also cause friction – staff may be concerned about job security or culture changes, while managers may struggle to motivate larger teams. So, where does communication come into all this?
Why you should plan employee communications for business acquisitions
A huge cultural change commands an effective communication plan. If you’re not sure what to include in your comms plan, consider how it will benefit your teams:
- They will need to understand the change and how it impacts their job role
- They will feel more engaged if they are involved in the process
- You can anticipate concerns and reduce uncertainty around job security
- You can prevent high staff turnover by fostering loyalty as you integrate different working cultures.
Planning your M&A comms: before the acquisition
Before the acquisition is announced, decide what needs to be communicated. Put yourself in your staff’s shoes: what will stay the same, and what will change? You should communicate immediate changes – even the bad news such as redundancies. Work with your HR teams to make sure you follow a fully compliant process with meetings and opportunities to appeal. Working methods may be one of the first things to change, but the new company may also phase this in. Look at what’s instant and what will take time, such as upgrading to new business systems and processes.
You should have dedicated representatives to answer questions and keep all senior management teams updated. Let your staff know where they can go to find information. You can also relieve pressure on a single contact by preparing considered responses in an FAQ document or video.
Above all, remember to keep HR and managers updated. Their buy-in is as crucial as the rest of your staff, so they need to be informed before answering questions.
How to make the announcements
Your plan should include who is going to make the announcements. Current staff may appreciate the familiarity of the existing MD, but it would be even better to have both the MD and the CEO of the acquiring company making announcements. This shows ‘buy-in’ from the top – instilling unity from day one.
Keep it clear and concise. Let staff know where they can turn if they have concerns. Make sure you answer five key questions:
1. What’s happening
2. Why the merger took place
3. Where the business goes from here
4. How teams will change, if they do
5. What it means for customers and other stakeholders.
Look at your current channels
Your communication channels should be consistent and relative to your business size. Look to see how your existing methods can work, for example, monthly team meetings. If yours is a smaller business, keep up with one-to-ones, video calls or all-staff meetings. Make sure you back up your message in writing, such as email.
If your organisation is larger, an initial video or intranet announcement can inform people at scale, but you will need to follow it up. Consider staff briefings or departmental meetings, and links to more information, such as internal newsletters.
Don’t forget that some staff may not have access to all channels – such as factory workers with email. Put up noticeboards and send out memos. Likewise, if your business is international, consider time differences with any digital announcements.
Once the acquisition is complete
Staff should always be your top priority, but next you’ll have to inform your stakeholders. Think about the channels you use for customers and suppliers – does one prefer email over face to face? Do your customers regularly engage with your social media? Have a plan for the channels you’ll use and draft a list of frequently asked questions. Remember that communication doesn’t stop here. Keep your stakeholders engaged with updates detailing your growth. This will help with ‘buy-in’ and ensure they understand the reasons behind the acquisition.
Where frequent comms helps
Keeping your staff updated will help them feel valued and allay any concerns about job security. While this is great for unifying teams, it will also improve retention – saving key funds on recruitment and helping to promote long-term profitability.
With a strong comms strategy in mind, you’ll not only assure staff in the short term, but build your vision for the long term.