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Around half of all business mergers are classified as unsuccessful in terms of “benefits realisation” and yet proposed large-scale mergers in the retail banking sector show that businesses are not losing their appetite for this risky process.
Brisbane-based change management experts Astor Levin explain in a recent whitepaper** the five reasons why mergers fail and six things organisations must do to stop this happening.
Failure is due to:
- lack of change readiness
- insufficient or ineffective planning
- failures in effective management of the change program
- ineffective communication
- insufficient follow through and a failure to achieve sustainable organisational learning
According to Astor Levin’s whitepaper, six points are crucial to the success of a merger:
- good communication
- linking reward/recognition with desired values/new behaviour
- acknowledging and responding with genuine empathy to employee resistance
- being aware of change burnout
- helping employees deal with continual change
- finding ways for employees to get involved in the change
Astor Levin director Sonya Melbourne adds “Really the number one culprit for the failure of change management programs – quite apart from the five reasons we cite in the white paper – is not understanding and dealing with the human element of the process. What looks good on paper can very quickly become undone if this is not taken into account.”
References
*Hunt, J. W., Lees, S., Grubmbar, J. and Vivian, P. D. (1987). Acquisitions: The Human Factor, London: London Business School and Egon Zehnder International;KPMG (1997);`Consulting the map: mergers and acquisitions in Europe’. (Research report.) London: KPMG.; and others
**Top Tips for a Successful Change Management Program