M&A Buyer: Communications are Critical

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The deal is complete… the acquisition announcement has been made publicly and to the interested constituents … employees, customers, retirees, vendors, and throughout the network of potential customers, vendors etc.

Now what?  The first question is, “Have you communicated with all the key constituents?”

 In a well-managed integration, there are two parts to effective communication – outbound, and inbound. Let’s explore these topics:

  • Outbound communications:  Well thought out communications anticipate the questions that the constituents will ask, and answer them – document them - in advance. Often these questions relate to things that matter most to the constituents:

  •        The employees – compensation, benefits, working conditions and processes etc.  
  •        When considering other constituents – current and potential vendors and customers etc - questions will arise around working relationships, business processes, terms and continuing relationships.  “Will my contact be available or reassigned?”  Or, “As they consolidate operations, will they terminate the need for service or reduce my rates?”  “Will I be billed weekly instead of monthly?”

Be thorough in your anticipation of all the constituent’s questions, document well thought-out responses, and don’t be afraid share the information proactively with key constituents. Lead the transaction, and don’t be reactive to dozens … hundreds … of questions.  If you don’t lead, you will appear to be out of control.

Dedicate an outbound communications media to delivering the official message – e.g. set up a website … develop a newsletter … establish a routine communication from known leaders to build on the trusted relationships already established.

Don’t surprise the constituents with changes in terms and conditions … don’t try to hide from them in hopes that the questions will disappear quietly.  If you are forthright and thorough in outbound communications, your chances of a successful transition will increase … remember, more than two-thirds of acquisitions fail to increase value.

  •  Inbound communications:  Good listening skills are critical as you execute the integration process.  If you have good listening skills you will be aware of issues that may ruin the integration.  If the integration team listens to the constituent’s comments, the team can quickly respond formally to festering questions. Questions can be researched to discover if the problem is isolated, or endemic, and a proper response can be developed

  •       Inbound communication requires a forum (anonymous or otherwise), effective analysis and quick response to serious issues.  Establish hot-lines, websites, surveys, or perhaps even independent services to collect responses/inquiries.  If you have planned properly, the regularly scheduled outbound communications can routinely address questions.
  •       Identify trusted individuals in the organizations who are accessible for Q&A, and when answers aren’t known, say so.  Make a commitment to respond by a specific time, and do it.  Personal credibility and trust will boost the probability of success.

 If you haven’t prepared properly, it will be obvious, and you will have a more difficult time re-establishing the trust required to integrate operations.  If you haven’t taken the time to establish effective communications with the constituents, you are projecting to all that they are unimportant.  Is this the message that you want to convey?