What You Need Most For A Successful Merger
POST WRITTEN BY Fran Biderman-Gross Founder & CEO at Advantages, a purpose-based marketing, and branding agency, I guide others so their potential can be revealed.
When a corporate merger is on the horizon, your next steps could mean growth or death for your company. In these times of change, the decisions you make are crucial to your business’s survival. The stakes are high, and the odds are against you. Mergers have a high rate of failure because companies often become so enamored by the possibilities that they forget the most essential aspect of any business: purpose. If you carefully consider your choices, with a focus on protecting and serving the reason your business exists, you will undoubtedly lead that business to grow and prosper.
Get to know each other. Don't let the potential for profit entrance you. If your purpose conflicts with your prospective partner’s, you will lose more than you stand to gain from the merger. Write down your values before you trade lists. Before anything else, learn and understand the causes that drive each company, the beliefs each company stands for, the visions they each hope to achieve and the ways they plan to achieve them. As in any other relationship, you need to truly know each other and complement each other well to succeed. So, ask as many questions as you would ask any partner before committing to them. Think about whether this is a good partnership to help make the change you want to see in the world.
Take the time to align. In any merger, both parties have to take the time upfront to build alignment and combine values. You need to integrate your beliefs and goals to accomplish all you plan to and survive the disagreements and hardships that will inevitably arise. For your merger to succeed, you must first get on the same page where it matters most. So, before you merge your companies, merge your purposes, and form the authentic united foundation necessary to survive and thrive. Know when to compromise and when to walk away. The prospect of a profitable deal can be intoxicating, but "deal fever" can lead companies to abandon the very beliefs that make them unique. From the first discussion, clearly articulate what you stand for and need to accomplish. Never let the romance of the deal blind you to the extent that you put your purpose and values at risk. Stick to your guns, and don't ever sacrifice nonnegotiables like the essence of your mission or vision.
Double-check the details. When two companies are becoming one new entity, integration is necessary on every level. Once you understand and agree with one another's values, you must each go through each layer of your organization to double-check your alignment. It takes a thorough evaluation to make sure you reflect one another's beliefs — in practice as well as process. If your cultures and procedures cannot be integrated, your companies should not be merging. Look over each other's organizational charts with the same rigor that you review one another's existing brand foundations. You require a proper understanding of your commonalities, conflicts, and redundancies to plan your merger accordingly. Share the excitement. A purposeful merger is an exciting opportunity. Be sure to let everyone know what's happening and connect it to your purpose. When delivered timely and properly, the news will build enthusiasm about the steps your growing company is taking toward your vision. Open communication is crucial to prevent any shadow from being cast over your purposeful plans. Your transparency will help prevent concerns and speculation that arise when people are left in the dark. So, highlight the meaningful benefits of your merger in writing; answer employees’ many questions, and celebrate the future you're building together. It seems intuitive to first get to know and align with one another before attempting to build a future with one another. However, inadequate understanding is the reason that so many mergers fail. The extent you must go to comprehend and integrate your brand foundations is deeper than one might think. Only with the knowledge of every facet of your prospective partner’s business — from purpose to procedure — can you make an informed decision to merge. It takes a tremendous amount of time, effort, foresight and communication to succeed, but if you are focused on a shared purpose, you will drive your profit, together.