Mergers & Acquisition - Managing the HR Issues
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Keywords
HRM, merger, Acquisition, business, markets, financial, legal, Organizational culture, national culture, Power Distance, Individualism Vs Collectivism
Links
Tools
Develop the 'HR' Project Plan
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A project plan is a critical document that directs and supports the whole process of integration and should be continuously updated to include the latest developments. The project plan should define the tasks to be performed in order of their priority. The owner for each task has to be identified and the responsibilities assigned. It is also important to note that the owner enjoys the authority to carry out the task successfully. Each task has to be given a due date of completion and the owner should keep track of the developments and record them. There should be common forum for exchange of information among the different task owners. In all probability, these tasks would be interrelated and the success of the project depends on effective coordination among all the task owners. Project plan is designed for any merger or acquisition. But, how many HR departments take the pains of designing a project plan exclusively for the HR activities planning. |
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It is also important to note that the support of other departments like the Finance and the Legal departments is essential for the successful implementation of the integration plan. Therefore, the inputs from these departments should be taken into consideration while working on the plan.
Conduct the 'HR' Due Diligence Review
A due diligence review helps the merging companies identify the presence of any hidden liabilities for the integrated business. This review would help the companies have a re-look at their decision and recheck its feasibility. It would also help the companies identify those critical areas which need immediate attention if the deal is to be carried out successfully. The common belief is that HR does not have any role to play during the due diligence review. But is it true?
It happened in some of the mergers that the companies failed to take note of the resentment brewing in the employees and by the time they realized it after the merger came through, more than half the workforce had left the integrated organization. HR due diligence review is one of the concepts that has come of age in the recent times. Some organizations are even looking at specific issues like
"culture due diligence review". Some of the components for the HR due diligence review are:
• Organizational culture and structure
• Employee compensation & benefits
• Industrial relations
• Pending employee litigations
• HR policies and procedures
• Key talent analysis