Question

Use a reputable and reliable source to support your response. Cite the source using APA formatting. News of mergers are plentiful: CBS and Viacom; CVS and Aetna; Keurig and Dr. Pepper; ThyssenKrupp and Tata Steel; etc. Some mergers are successful, while others fail. Chapter 2 begins the discussion of the accounting treatment for mergers and acquisitions.There are many steps that precede the culmination of a merger. What factors might prevent a merger from going forward? List at least three.

Answer 1

Factors might prevent a merger from going forward

• Prepare for change
• Communication is king
• The merging of 2 cultures
• Processes, processes, processes
• Train your people on the new processes
• Leaders should lead, not manage
• Evaluate and course correct

Prepare for change.

Change is hard. Everyone deals with it differently. Some people avoid it. Some take baby steps. Some confront it. Some dive in head first and change everything. A merger or acquisition requires new behaviors and ways of doing things. As the Borg say, “Resistance is Futile.” Perhaps, but resistance can be minimized and the speed of commitment increased – increasing your ability to achieve success through people. Organizational change is inevitable, but that doesn’t mean it has to be painful or costly. Have a detailed change management plan in place. Execute. Don’t forget about the people. People adapt to change at different a pace. People internalize change in different ways. Change is emotional. Getting your people to commitment to change is not a one size fits all off the shelf solution.

Communication is king.

Most, if not all, of organizational issues start with a lack of communication or miscommunication. This increases even more when it comes to mergers & acquisitions – as now you have 2 organizations trying to (or perhaps not trying to) communicate as one. Timely communication explaining the process and impacts, how it affects the teams of people and customers, and communicating and then providing what everyone needs to do to succeed — all while keeping open dialogues in all directions — is imperative to a successful transition. If you fail to do this – people talk, make assumptions, engagement declines, productivity declines, and service suffers greatly. You end up with confused and unhappy employees and confused and unhappy customers.

The merging of 2 cultures.

Culture is the way work gets done around here. For long term success you want a high performing culture. Although some cultures are similar, organizational cultures are like snowflakes, no two are the same. So when 2 ways of doing things are merged, you’re going to bump into roadblocks. It’s not about right and wrong or what is and what was. It’s about merging the 2 and finding what works best moving forward. You can’t have a successful merger or acquisition with an attitude of “well we bought you so to bad adapt and do it our way!” Organizational culture isn’t just the result of one swift decision, but an ongoing process and way of being. Ask for feedback and act on feedback. Bringing 2 cultures together is a journey. A journey your people, and even customers, need to be involved in from day one. Mourn the past and begin to build a new future together.