Something that can be either exciting or nerve racking, depending on your point of view, is a merger or acquisition. For many businesses, this means expanding into entirely new markets that could greatly expand your revenue streams. Others, however, may be nervous about losing their jobs or influence.
Whatever the case, handling a merger or acquisition can be tricky. Many attempts at combining two companies together have failed. You need to know how to handle the process properly.
Focus on the Customer Experience
One of the biggest pitfalls of a merger or acquisition is that the customer experience can suffer greatly during this transition period. This is often due to the fact that management becomes mainly concerned with the technical aspects of the merger and loses focus on important things like customer service. However, bad customer experiences often equate to lost business. You may assume you’re gaining a lot of new customers through a merger or acquisition. However, if customer experience is ignored, you may end up alienating almost all of those consumers.
Consider Company Culture
Some of the most drastic changes to a company that exits a merger or acquisition usually happen to its company culture. Give this serious thought. Do you want to continue the culture of one company or combine both cultures together? Making sure the employees you retain are on board with the changes is extremely important and can help eliminate some of the growing pains.
Have the Legal Aspect Well Covered
The process of merging two businesses together is an incredibly technical one. There is a lot of legal red tape to go through first before such a deal is even approved. If you don’t take care of the legal aspect early, it could result in the entire deal falling through. The government may even block it from happening. This won’t only be a lost opportunity. Your stock price could plummet as a result. Always make sure you have the correct legal expertise on board to guide the process. If you don’t already have lawyers with the proper experience, find that do.
Communicate Clearly with Employees about the Process
Another problem occurs when employees from either company feel like they are being blindsided with developments regarding an ongoing merger or acquisition. This can absolutely devastate worker morale and lead to a steep drop-off in productivity. Make sure this is not the case by communicating every aspect of the process with employees of both companies as clearly and as early as you can.
Mergers and acquisitions can be very stressful for many people. However, if you take more care to perform the process in a way that does not alienate customers or employees, you can avoid a lot of the major problems that can happen. Overall, don’t rush into this process. Be careful and strategic about every aspect of it to ensure that the company that emerges afterwards will be successful.