The four stages any entrepreneur goes through   

The four stages any entrepreneur goes through   

Running a business is not something easy to do and while some people manage to succeed although they do not have a lot of experience, others may fail even if they are More »

Steps to starting a small business

Steps to starting a small business

If you are interested in setting up your own business, then there are a few important steps to follow in the process. Because the business world is highly competitive, it is more More »

Keeping your social media fans engaged – how to attract new followers

Keeping your social media fans engaged – how to attract new followers

Considering that social media marketing is more popular than ever and can have a very important influence on the success of a company, managers will need to always be careful with their More »

 

The key to handling a corporate merger

Merger is a fancy term that is used to refer to the consolidation of companies or assets. To put it simpler, merger implies the combination of two companies to form a new one. Once the merger is realized, the acquired company ceases to exist and becomes part of the acquiring company. Form a business point of view, merging companies in the same sector is a no brainer, especially if you get advice. For acquisition advisory service, visit bhpcorporatefinance.co.uk. About 70 percent of mergers fail due to the cultural challenges that the process implies. Mergers as well as acquisitions create winners and losers at the corporate and individual staff levels. Therefore, successful management necessitates successful management of the people that are involved.

M&As play a significant role

In the course of survival and vitalization of a corporation, mergers and acquisitions play a major role. They continue to be a good strategy for innovation, profitability and market share. While companies often view mergers as being a strategical end-game, they are rather a main event. According to general opinion, nearly all industry research confirm that when mergers do work, the integration process seems to be fluid and well executed. Nonetheless, there are some issues that hinder the success of the merger and acquisition.

What you need to know  

The merger will take longer that you expect. The truth is that you cannot put your competitors together and expect them to get along from the very first day. Until this stage, they were used to viewing each other as being the enemy, so you will have to carefully manage reporting lines and watch out for signs of tension. You should not assume that managers who say that they are dedicated to the new company rules will truly be. Loyalty is not easy to come by and you will see that people will jump sides as soon as a better offer is presented to them. Competitors will not be the only ones that will try to strike you when you are down. Customers might also try to obtain better deals from you and threaten to bolt to the competition. This is why it is necessary to engage with them form an early stage.

Post-merger consolidation

You should take as much time as it is necessary to spend with your financial analysts and spend it with your employees. Since people care about where they work, you should transform them into a strategic partner. What you should do is get people from the merging company and the company that is being absorbed from the very beginning. Discuss together the issue that were perceived as the potential benefits openly and make sure that people listen to what each other has to say. You yourself will need to be honest with people.

In the end, you should remember that a company is only as strong as the team is. When you are merging two companies, employees will be biased toward the people and the products of the original company. This is why you should pay attention to the human factor as well.