Why do so many post-merger integration plans struggle to be implemented? What can merger experts do to facilitate and streamline integration efforts? To answer this question we have to look at the communication plan.
Did you know that poor communication costs midsize to large corporations on average $62.4 million annually? Communication, as we all know, is at the heart of any business and it should be a top priority in a recently merged entity. A strong communications strategy sets the foundation for clear directives to flow from management and stakeholders to employees and customers. And the lack of such a structured plan will amount to nothing short of chaos.
A good communication plan precedes merger
Communication teams are present from the onset of a merger and acquisition deal. They are as it were the front-liners the moment conversation around business acquisition begins. They are the ones responsible for overseeing, developing, and managing the post-merger integration aspects.
The goal of such a team is to encourage business continuity and foster strong relationships between merged companies. It is the communication team that must filter the right information down to employees, vendors, regulators, and stakeholders. It is their task to keep morale up and ensure turnover is kept to a minimum. Theirs is a job that transcends and cuts across every department and unifies all parties.
To assist them in this overly important task, the communication team designs a plan that dictates their actions at every stage – before the M&A happens, during negotiations, and after the deal is signed.
How to draft an integrated communications plan
What are the steps to take when putting together an effective integration plan? There are five core elements that must be considered. However, because of the complex nature of mergers and acquisitions there is no “one-size-fits-all” approach to structuring these plans. Each communications team can tailor and adjust as they see fit.
1. Identify leading stakeholders
When companies merge there are many people that must be informed. They fall into two major categories: internal and external stakeholders. The way you communicate with each group will be different as each requires a particular tone that addresses their interests.
External stakeholders are generally investors and analysts who must be convinced of the associated benefits of the deal. Customers and vendors are another part of the external lot whose continued loyalty must be carefully courted.
Internally, we are looking at employees from the two businesses. Tensions will undoubtedly high as is common in such high profile transactions. When structuring a strategy around employees, it should include communication for workers unions and any legal documents you may require.
2. Identify hotbed issues and significant milestones
It is imperative that communication teams identify situations that can prove bothersome so adequate preparation can be made ahead of time. These issues may be severance packages, litigation cases from disgruntled employees, and or other third parties.
Concurrently, the major milestones also need to be anticipated so external and internal stakeholders can be informed correctly. Such milestones may include the announcement of new leadership structures and when the official Day 1 will be.
3. Establish governance systems for the communications team
The communications teams must be on top of things at all times. This requires sufficient resources in the form of both human capital and finances. Integration success rests upon good governance structures within the communications team.
More likely than not there will be three distinct roles within such teams: The integration leader, the integration steering committee, and the communications leader. All work together like a well-oiled machine ensuring that the communications plan is executed expertly.
4. Frame your core messages and how you will deliver them
Communications teams must carefully extract the main points to be transmitted to stakeholders from the meetings taking place behind closed doors. These key points or core messages will be the narrative that is pushed and will help keep everyone on the same page.
The message must be unifying, positive and reinforce the value to be had in coming together. It’s not hard to see that the communication plan is really pivotal in getting both internal and external stakeholders to understand what’s happening.
5. Develop open communication channels
Communication involves dialogue. The communication plan must take into consideration the feedback from employees and external parties. An open communication channel between the communications team and these entities is critical as their input can help consolidate and speed up integration. When people feel as though their opinions and values are being heard and addressed they are more likely to co-operate with post-merger integration efforts.
Considerations to factor in when building an integration communication plan
What are some of the things communications teams must be aware of when building their communications plan?
Develop the communication plan early: everyone waits on the communications team for information. Therefore make sure you start working on drafting clear strategies early on.
Leave no one behind: don’t overlook stakeholders no matter how insignificant in the deal they may be.
Promote harmony within the hierarchy: the objective of the communications plan is to unite parties not create division and disunity; watch your tone and language.
Don’t overlook culture: culture is often a neglected element during deal structuring. Be mindful of the different company cultures when delivering messages.
Broadcast clear directives: messages should be clear and concise and not leave people wondering what the message actually was.
Remember you’re talking to human beings: this is particularly important when you have to deliver unpleasant news such as layoffs and retrenchments.
Discuss your communications plan with qualified brokers
Would you like to go over your communications plan with a team of skilled qualified brokers? Sun Acquisitions is one of the leading business brokers in Chicago. Our advisory services include strategy development, divestitures, acquisitions, consultations, and business valuation. To discuss your communications plan don’t hesitate to reach out to us. Contact us to schedule a complimentary and confidential consultation with one of our certified advisors. Let’s discuss your business and review your goals.
Disclaimer: Any information provided in this blog is not intended to replace legal, financial, or taxation advice given by qualified professionals.