12 Concepts We Can Learn About _____ From How2Exit's Interview With Dr. Klint Kendrick - Watch Here
Here is what my team and I learned from this interview: (These are notes from team members, writers, sometimes AI, and even listeners who submitted what i learned loosely edited and shared here) - If it seems a bit unrefined, you're reading our notes, so. yeah. -Ron
Concept 1: Invest In People First
One of the most important lessons in mergers and acquisitions is to invest in people first. This is something that Dr. Klint Kendrick, a 10-year veteran in the world of M&A, has learned through his own experience as an acquired employee and catching manager. He has seen firsthand the implications of not taking care of people during a merger or acquisition and is passionate about making sure the people, leadership, and culture issues are attended to.
When a company chooses to purchase another company, they are making a decision on how to spend their money. It can be put into research and development, marketing, salaries, or buying a company. It is easy to focus on the financials and overlook the importance of investing in people. But it is essential to remember that the people are the most important part of any transaction.
When a company is being acquired, the employees often experience uncertainty and fear. They may worry about their job security, changes in their pay, or how the company culture will be affected. It is important to take the time to address these concerns and ensure that the employees feel valued and secure in their positions.
Investing in people also means taking the time to understand the culture of the company being acquired and making sure it is respected in the transition. It is important to ensure that the values and mission of the company are not lost in the process. This can be done by taking the time to onboard the CEO and team, and making sure that their skills and knowledge are respected and utilized.
Overall, it is essential to remember that people should be the priority when it comes to mergers and acquisitions. Investing in people first will help ensure a successful transition and help create a culture of trust and respect. It is important to take the time to address the concerns of employees and ensure that the company culture is respected and maintained. Doing so will help ensure a successful merger or acquisition.
Concept 2: Honor Employee Change Resistance
When it comes to mergers and acquisitions, it is important to remember that people should be the priority. Harvard Business School has found that up to 90% of all M&As fail to deliver value. This is often due to people and culture issues. To ensure a successful transition, it is important to take the time to address the concerns of employees and ensure that the company culture is respected and maintained.
This can be done through a thorough due diligence process. This process should involve not only looking at financial statements and spreadsheets, but also looking at the cultural and compliance components. It is important to look at how people affect the actual operations of the business and how the transition will affect the staff. For example, if the company was used to hiring people in two days, but the new company’s process takes 75-90 days, this could cause a disruption in the workflow.
When it comes to change, it is important to remember that people don’t like change being forced on them. It is essential to honor the change resistance of employees and take the time to address their concerns. Doing so will help create a culture of trust and respect and help ensure a successful merger or acquisition. It is also important to be aware of potential disruptions in safety and productivity. Taking the time to invest in people first will help ensure a successful transition.
Concept 3: Focus On Decision-Making And Operations
One key factor in ensuring a successful merger or acquisition is to focus on decision-making and operations. The founder or top executives of the company may be excited about the sale, but the employees may be more concerned about their job security, medical care, and other issues. It is important to have a communication plan in place to ensure employees understand the changes and how they will be affected. This plan should include information about the similarities and differences between the current and future organization, and how decisions will be made.
Additionally, it is important to understand where culture clashes may occur. Research into the key drivers of culture clash can help identify potential issues. Common areas of conflict include decision-making, team collaboration, roles and responsibilities, and operational expectations. For example, if one company uses Slack for communication and the other does not, this could cause a disruption in team collaboration.
Overall, it is important to focus on decision-making and operations in order to ensure a successful merger or acquisition. Taking the time to understand potential culture clashes, create a communication plan, and invest in people first will help create a successful transition.
Concept 4: Respect Cultural Boundaries
When it comes to mergers and acquisitions, culture clashes can be a major issue. It is important to understand the culture of the organization being acquired, as well as the culture of the acquiring organization. This includes operational expectations, communication styles, and the organization’s self-concept. Additionally, it is important to consider synergies, secret sauce, and sacred cows.
Synergies refer to the potential cost savings and efficiencies that can be achieved through the merger or acquisition. It is important to ensure that these are achievable in order to avoid potential culture clashes. Secret sauce refers to the proprietary technology, processes, or intellectual property of the acquiring organization. It is important to ensure that this is not lost in the transition. Sacred cows refer to the unique cultural aspects of the organization, such as snacks, tea service, or other perks that employees might be used to. It is important to respect these cultural boundaries and not make any changes that could potentially upset employees.
Communication is key in any successful merger or acquisition. It is important to create a communication plan that outlines the expectations of both parties. This should include how the transition will be handled, what changes will be made, and how employees will be affected. Additionally, it is important to invest in people first. This means taking the time to understand their needs, concerns, and expectations. This will help create a successful transition and ensure that cultural boundaries are respected.
Overall, it is important to focus on decision-making and operations in order to ensure a successful merger or acquisition. Taking the time to understand potential culture clashes, create a communication plan, and invest in people first will help create a successful transition. This will ensure that cultural boundaries are respected and that the transition is as smooth as possible.
Concept 5: Understand Company Culture
When it comes to understanding company culture, it is important to look at public information, reviews, press releases, and social media feeds. This will give you an early indicator of what is going on within the company. Additionally, you should look at the way the company operates, what is on the walls, and how the employees interact with each other. This will provide insight into the company's values, beliefs, and norms.
When it comes to mergers and acquisitions, it is important to ask questions about the company culture. This includes asking about the company's sacred cows, such as the types of activities that are encouraged or discouraged, the way decisions are made, and the way employees interact with each other. Additionally, it is important to ask about the company's risk tolerance and what the plan is for transitioning employees.
When it comes to understanding a company's culture, it is important to understand the risks associated with the transition. This includes considering potential culture clashes, creating a communication plan, and investing in people first. Taking the time to understand the company's culture and its values, beliefs, and norms will help ensure a successful transition. Additionally, it is important to consider the company's risk tolerance and to create a plan for transitioning employees. By understanding the company culture, it will be easier to create a successful merger or acquisition.
Concept 6: Monitor Social Media Activity
One way to gain insight into a company's culture is to monitor its social media activity. This includes looking at the company's website, its social media accounts, and its employees' social media accounts. It is important to look at the history of the conversations and interactions between the staff, as well as the conversations between the leaders and the staff. This can provide valuable insight into the company's culture, such as whether everyone has an equal voice at the table or if the leaders are driving the conversation. Additionally, it can provide insight into the company's risk tolerance and how it is handling the transition.
In addition to monitoring the company's social media activity, it is important to talk to the employees after the deal is announced. This can give a better sense of the culture and how things are going. It is important to not just talk at them, but to actually listen to what they have to say. Additionally, it is important to monitor any changes in the conversations and interactions on social media, as this can provide insight into the company's risk tolerance.
Overall, monitoring social media activity can provide valuable insight into a company's culture and its risk tolerance. Taking the time to understand the company's culture and its values, beliefs, and norms will help ensure a successful transition. Additionally, monitoring social media activity can provide insight into how the company is handling the transition and its risk tolerance. By understanding the company culture, it will be easier to create a successful merger or acquisition.
Concept 7: Employees Have Choices
Employees have choices when it comes to the companies they choose to work for. They can choose to stay with their current employer, take their talents elsewhere, or even join a new company through a merger or acquisition. In today's competitive job market, employees have more power than ever before. They can pick and choose who they want to work for, and companies have to take this into account when looking to acquire or merge with another company.
When a company is looking to acquire or merge with another, they must understand the culture of the company they are looking to join forces with. This means understanding the values, beliefs, and norms of the company, as well as how the company handles risk. It is also important to monitor social media activity to get an idea of how the company is handling the transition and its risk tolerance.
When looking to acquire or merge with another company, it is also important to consider how the transition will affect the employees. Employees may experience an identity crisis, as they are now working for someone else, and uncertainty, as they are unsure of what the future holds. Companies must take steps to retain these employees, whether it be through money, culture, or other non-financial incentives.
Employees have choices, and companies must take this into account when looking to acquire or merge with another. It is important to understand the culture of the company and to monitor social media activity to get an idea of how the company is handling the transition and its risk tolerance. Additionally, companies must take steps to retain employees, as they are a vital part of the success of any merger or acquisition.
Concept 8: Explore New Opportunities With Bigger Companies
One way to retain employees is to ensure that they are comfortable with their new identity. This can be done through activities such as updating emails to reflect the new company name, providing stress balls with the company logo, and providing employees with information about the company’s core values, operating norms, and expectations. Additionally, it is important to provide employees with the opportunity to learn about their new roles and the potential for career advancement.
When a company is looking to acquire or merge with another, it is important to consider the impact it will have on employees. Companies should ensure that employees are aware of the opportunities available to them, as well as the potential risks. Additionally, companies should provide employees with information about the company’s culture, as well as the potential for career advancement. By doing so, companies can ensure that employees feel comfortable with their new identity and can explore new opportunities with the bigger company.
Concept 9: Winning Takes Sacrifice
One key concept that is often overlooked in the process of a company acquisition or merger is that "winning takes sacrifice". This concept applies to both the company and the employees. For the company, it means that it may have to make certain sacrifices in order to achieve success. For example, it may have to invest in new technology or make changes to its existing processes. It may also have to make changes to its staffing levels or its organizational structure.
For employees, the concept of "winning takes sacrifice" means that they may have to make changes to their roles, or even their job titles. They may have to take on new responsibilities, or they may have to take on a new job entirely. They may also have to make changes to their salary or benefits package. In some cases, employees may even have to relocate to a new city or country.
Ultimately, it is important for companies to recognize that "winning takes sacrifice". If companies are not willing to make the necessary sacrifices, then they may not be able to achieve success. Furthermore, if companies are not willing to invest in their employees and provide them with the resources and support they need, then they may not be able to keep their employees engaged and motivated. By understanding the concept of "winning takes sacrifice", companies can ensure that they are making the right decisions when it comes to acquisitions and mergers, and that they are providing their employees with the resources and support they need to achieve success.
Concept 10: Understand How Values Are Implemented
One of the most important ways to understand how values are implemented is to look at how they are operationalized. Companies can start by looking at their mission statements and values and asking themselves how they are operationalized. It is not enough to simply have values on the wall, but it is important to understand how those values are implemented within the organization. Companies should ask their employees how they are implementing the values and what they are doing to ensure that they are being followed. This will give companies a better understanding of how their values are being implemented.
Another way to understand how values are implemented is to look at the company's HR policies. Companies should ensure that they are compliant with all local and state laws when it comes to their HR policies. They should also look at the benefits they are offering their employees and make sure that they are competitive with other companies in the industry. Companies should also look at the HR policies of other companies in the industry to see what they are doing differently and how they are implementing their values.
Finally, companies should look at their employees and see what kind of support and resources they are providing them. Companies should ensure that their employees are given the resources and support they need to succeed and that they are not cutting corners when it comes to their employees. Companies should also look at their employees and ask them how they are implementing the values and what they are doing to stay motivated and engaged.
Overall, understanding how values are implemented is essential for any company. Companies should make sure they are operationalizing their values and providing their employees with the resources and support they need to achieve success. By doing so, companies can ensure that they are making the right decisions when it comes to acquisitions and mergers, and that they are providing their employees with the resources and support they need to achieve success.
Concept 11: Don't Lie To Employees
In this podcast, Klint Kendrick discussed the importance of not lying to employees during a merger or acquisition. He highlighted how cultural differences can make or break a deal and how sacred cows, such as childcare, can be a factor in the decision-making process. He also discussed the importance of understanding total rewards, such as pay, bonuses, benefits, and perks, and how discrepancies between companies can lead to employee dissatisfaction.
Kendrick emphasizes the importance of not lying to employees about changes and not surprising them with changes. He advises companies to be transparent about the changes that are being made and to not promise that nothing will change. He also suggests that companies should use a structured approach to understanding the differences between companies, and to consider increasing base pay or making other changes if bonuses are no longer available.
It is essential for companies to be honest and transparent with their employees during a merger or acquisition. Companies should make sure they are communicating openly and clearly with their employees, and that they are providing them with the resources and support they need to succeed. By doing so, companies can ensure that they are making the right decisions and that their employees are satisfied with the changes.
Concept 12: Achieve Success Faster
One way to achieve success faster is to take advantage of the resources available to you. This includes taking advantage of the knowledge and experience of other professionals, such as those found in The Investors and Entrepreneurs Professional Mastermind. This organization provides a platform for professionals to come together and share their experiences and knowledge, while also providing accountability to ensure that everyone is taking the necessary steps to achieve success. By taking advantage of the resources available, companies can gain insight into the best practices for mergers and acquisitions, and can use this knowledge to make the right decisions.
Additionally, companies should also consider investing in books, such as the HR Practitioner's Guide to Mergers and Acquisitions Due Diligence and the HR Practitioner's Guide to Cultural Integration in Mergers and Acquisitions. These books provide detailed information on the process of mergers and acquisitions, as well as advice on how to ensure that the process is successful. By taking the time to read and understand these books, companies can gain a better understanding of the process and can use this knowledge to make the right decisions.
Finally, companies should also consider investing in their employees. By providing them with the resources and support they need to succeed, companies can ensure that their employees are satisfied with the changes and that they are making the right decisions. This can help to ensure that the process of mergers and acquisitions is successful and that the company is able to achieve success faster.
Overall, there are a number of steps that companies can take to ensure that they are making the right decisions during a merger or acquisition and that they are able to achieve success faster. By taking advantage of the resources available, investing in books, and investing in their employees, companies can ensure that they are making the right decisions and that they are able to achieve success faster.
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