Five tips to protect your most important asset (your employees) during a merger

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It seems that everyday we hear about new mergers.  And although mergers are often done to create a more competitive company, the result is often less than expected. One of the reasons is a gross underestimation of the impact on the key asset: the employees. Mergers are never easy, but if done well, they don't have to be traumatic to the people or the bottom line.

Here are some tips:

• Communication is vital. Employees are hungry for information and if they don't get it, they'll fill the void with rumors. Even if the CEO and managers don't know much new information from week to week, frequent meetings are still important. Employees need to feel that they will be kept in the loop as changes are happening.

There is also a great sense of relief in just coming together during a huge change. It makes people feel more connected and "in it together." The most important outcome is that the employees will feel that the company respects them and cares about how they feel. It's vital for maintaining commitment to the company.

For example, one company started a Rumors Hotline for employees to call and leave a message. Each week, the questions were responded to in roundtable discussions in the cafeteria. In another company, the CEO had "fireside chats" with a rotating group of employees and the minutes were posted.

• Don't move too fast. There is a tendency to think of people as just another asset on the balance sheet. During a merger, fast decisions are made about duplicate systems and functions...and people. Departments are often wiped out, new policies are imposed from the dominant partner in the merger. In short, people feel vulnerable and out of control.

In one company, the directive was to reinvent all the human resources policies, payroll, performance reviews-everything-in twenty days. At the same time, top management was saying, "We are going to establish a collaborative culture." Top management felt that if all these things were put in place quickly, people would just settle down and get back to work. On the contrary; people would feel jerked around and abused because there was no attempt to get any input. The cynics would have a hay day.

Fortunately, the company decided to work on the must-do items like payroll first, and take a more collaborative approach as it developed the rest of the human policies. People were relieved that the basics were being taken care of and pleased that they would be able to participate in creating the new culture together (even if it meant living with parallel systems for awhile).

• Be honest. In the long run, it will pay off. Any merger immediately alerts employees to watch for out for number one. If they feel lied to or betrayed with half-truths, productivity will plummet and employee commitment will end.

Even though it's extremely difficult to tell people bad news, employees who have been through it emphasize that they would rather be treated like adults and hear the facts. They want to know what their options are so they can settle down to work or get on with their lives somewhere else. Good employees are likely to stay if they hear the truth, because it breeds trust.

• Treat people with dignity. Too often, changes are made in the dark of the night. I hear horror stories about how employees are treated during mergers. Top management needs to recognize that every eye is on them. Any employee who is treated poorly will become the company martyr and every employee will be convinced that they could be next. Productivity is shot, morale sinks and the loyalty bond is forever broken.

For example, if people are to be laid off, providing some kind of job hunting assistance not only helps those who are fired, it also tells the survivors that they will be treated respectfully, too.

• Managers need to be treated as partners with senior management. Frequently, the CEO and top management lock themselves away in lengthy meetings with their new counterparts to work through the details of the merger. The managers feel cut off and uninformed. Then when employees ask them questions they feel foolish. The troops will have much higher morale and the changes will receive much more managerial support if middle management isn't cut out of the leadership loop.

Would you like to bridge the commitment gap with your employees?   We provide management consulting, executive coaching and customized, skills-based training for managers and supervisors, that changes behavior, creates a healthy culture and builds a customer-focused team.  Call us today at (800) 348-1944.