Dealings with feelings: using authentic leadership to maximise M&A success

M&A is an emotional rollercoaster. Those of you who have worked on deals will know this only too well. They can flip from being intense, high-pressured and contentious environments to providing euphoric feelings of accomplishment.

So, what is the common denominator across all deals on this rollercoaster ride? Human beings; real people and real emotions. In an area dominated by data analysis, documentation, legalities and financials, the importance of managing people must not be underestimated.

We advise leaders to treat people like humans and not just like part of a transaction. You should treat them with respect, honesty and integrity; both those working on your deals and those impacted by the implications of it. Take the time to engage with people and understand their genuine emotions – avoiding this will result in some degree of failure; whether that is on you as a leader or on the business as it will struggle to achieve the maximum value potential from your deal.

Five considerations to prioritise your people throughout M&A activity

1. Proactively manage the change

Proactivity is key– this will allow you to take control of matters and get on the front foot. If you are being reactive, it is often too late. From the outset of a deal through to closure and beyond, you need to plan and manage the change comprehensively, including anything from stakeholder engagement, leadership alignment and running change impact assessments. Having robust change management led by dedicated experienced practitioners embedded throughout your M&A programme will prove invaluable.

2. Communicate effectively

You should implement regular, clear and honest two-way communications with people across all levels in your organisation. Let people know what is changing when and, most importantly, what the impact could be on them. Even if you can’t share everything you know, as is often the case, be open about it and set realistic expectations for when they can find out more. Keep the regular communications up even if there is nothing new to say; use the opportunity to reinforce key messages and check in. Communications should be also be provided through multiple channels and include both informal and formal touchpoints.

3. Cultivate your culture

Don’t rely on “hope” to achieve, or even maintain, your target culture. M&A can impact company cultures – mergers and acquisitions bring two different cultures together, and divestments can remove parts of it. The question you need to ask as a leader is “what do you want your culture to be?”. Creating a culture you want – a culture that will truly let your organisation and people blossom – is unlikely to happen organically. You need to assess how the transaction will impact your culture, and put in place a long-term plan to work towards achieving it.

4. Support mental health and wellbeing

Supporting employee health and wellbeing is nothing new to organisations, but the nature of deals often means consideration to it should be heightened. It’s an environment where people can experience a range of emotions, and the longevity of these extremes can be challenging to manage. Offer support, remind people of where to go for help and ensure your leadership team does whatever they can to lead by example on this. Experiment with different initiatives to see what works best for your organisation, for example, starting team meetings with a pulse check on how everyone is feeling, having a dedicated health and wellbeing team on the programme, offering mindfulness and yoga sessions, or enforcing no meeting days each month to let people get back on top of things. Get feedback as you go and pivot around what you hear to provide personalised and varied support to your people.

5. Maintain respect

M&A activity can be unsettling, with varied impacts across different people. Some people may get promotions or improved benefits, whereas others may end up with worse packages, be concerned about their job security or ultimately lose their jobs. From the very top of organisations down, if people remain respectful to others, then everything can be built from there. Maintain respect when delivering the tough messages, through the challenging intense work, the high-pressure situations and when making the big decisions; maintain genuine respect for yourself and others to achieve the best chance of success.

Reap the rewards

To achieve the full, long-term value potential from your deal, you must effectively manage and support your people (promoting supportive workplaces should be standard practice anyway). If you focus appropriately on yourself and those around you, you will experience the maximum benefits – emotionally and financially – of going through the journey together. So, strap in and enjoy the ride…