Trends Human Capital Affects M&A Activities

Inherent Challenges

trends Human Capital Affects M&A Activities

a cook associates report

C id i thtth ti fM&A ll h di

Even when the acquiring company takes every measure possible

to make the acquisition a positive experience, the reality is that

there will be fallout.

Ann MacCarthy, a Managing Director with the executive search

consultancy at Cook Associates, Inc. commented, "I have

found that some employees from the acquired company do not

Considering that the notion of M&usually goes hand in

hand with integration efficiency, which is usually coupled

with downsizing or process change, your search partner

can offer a professional and dispassionate perspective that

is familiar with many different types of business processes.

In this way, they can help you establish "best practices"

out of the colliding and moving parts of each organization

p y q p y as they are merged together.

want to be part of a larger entity; still others feel a sense of

loyalty to someone who will not be part of the newly combined

organization and so they will move on with that individual. At

the very least, an acquisition is going to generate anxiety and

confusion, making employees wary, cautious and suspicious of

the new entity."

I dditi t tt iti d lt l fit th h ll i l d

y g g

Search may also be called upon as a reference. "To me,

executive search can be another lens to peer through

when you're even evaluating a potential company. A

strong and informed relationship with your search

partners can provide valuable insight and on-going

assessment of the reputation of other companies and the

In addition to attrition and cultural fit, other challenges include lit f th i t l t " id M M Cl

harmonization of compensation and benefit plans, and

leadership assessment and selection.

This means that early on in the M&A process, all executives in

leadership positions must communicate and listen effectively to

build trust, candor and transparency with its acquired

employees. Also, it's imperative to build an appreciation and

quality of their talent," said Mr. McClure.

Keep in mind that an M&A event will affect the pace of

any active searches. Ms. MacCarthy notes, "As a client, be

aware that candidates could shy away from exploring the

opportunity because they are uncomfortable with the

ambiguity, whereas others may become more interested as

p y , p pp they perceive a strategic move toward growth."

respect for the uniqueness of each culture rather than

immediately seeking to homogenize everyone into one.

Your Search Partner

While there will be fulfillment needs as you deal with gaps and

vacancies brought upon them by the acquisition, your executive

search partner can do more by serving as a trusted business

d i

y p g g

Ultimately,