THE BIG IDEA:
Faced with an M&A, leaders must let go of past accomplishments and embrace new challenges
Following nearly three decades of work in corporate America, Jennifer Fondrevay is the self-described “M&A Whisperer,” one of the world’s leading experts on the impact of mergers and acquisitions on human capital. Currently, Fondrevay wears several leadership hats: she is the founder of Day1 Ready, an M&A transition consultancy, and managing director of Virtas Partners, a boutique transition services and restructuring firm.
Fondrevay is also the author of the best-selling book Now What? A Survivor’s Guide for Thriving Through Mergers and Acquisitions, an exhaustive examination of how M&As impact employees, and “a playbook” for human resource practitioners who may be faced with the seismic disruption that accompanies both mergers and acquisitions. During our recent conversation for an episode of my Lead the Future podcast, we discussed the mindsets that leaders need to shed in order to embrace the challenges and recognize the opportunities, that come with M&As.
WHY IT MATTERS:
Leaders must be able to manage constant change because it’s not going away
I have often told the leaders I work with not to be daunted by change. It’s everywhere, all the time and there is no way to stop or even slow things from changing. It’s the idea that change is not something that makes our jobs as leaders more difficult; change is the job.
In her book, Fondrevay created characters for the different types of personalities that typically come to life when leaders are going through an M&A process. Two of these types of leaders have an aversion to change:
- the ostrich, the person who hides their heads in the sand when the need to change arrives;
- and the “missing-in-action” leader who seems to somehow disappear whenever the going gets tough.
Leaders who want to effectively manage change must always be ready to acknowledge that change is real and it’s unavoidable.
“(As a leader) do not say ‘nothing’s going to change.’ The intention of (CEOs) is good, to calm people down. But if you say ‘hey, everything’s going to stay the same … the fact is that everything has already changed.”
When you are leading a team through a process of change, you need to help your teams understand what is coming as best you can, open lines of communication, and be present as you move with a united front through the challenge ahead.
Underestimating the impacts of change can have a devastating impact on your people
When helping organizations manage big change like an M&A, Fondrevay consistently warns leaders about the natural bias they will have to focus on process and not people. In the cases of an M&A, this is particularly dangerous. Fondrevay told me that when two companies are being combined into one, there is so much emphasis on “the deal” that they overlook red flags like differences in culture.
“Mergers and acquisitions always bring dramatic change. (Leaders don’t) appreciate the impact of that and how people react differently to change. You can never assume everyone will uniformly embrace this.”
To properly embrace change, leaders need to be honest and vulnerable
Self-awareness is such an important quality for leaders to possess, particularly when managing change. Jennifer and I talked at length about how self-awareness can help leaders keep open minds, which allows them to pivot to embrace new challenges and, as she so eloquently noted, admit that we “don’t have every answer.” That one admission can open the door to a lot of positive stuff.
Here are a few strategies, based on Jennifer’s TEA concept (Talent Effort Attitude), that you can share with your team as you navigate, collectively and individually, the uncertain and ambiguous process of a merger or acquisition:
- Be proud of, but don’t focus on past achievements: One of the more important manifestations of self-awareness that we talked about was the need for leaders to de-emphasize past accomplishments as justification for future opportunities. Jennifer reminds us, “If you stay stuck holding on to your past achievements, then you’re not contributing to the new way forward.”
- Focus on contribution, not title: By helping leaders recognize and highlight their talents and the impact they make on the organization, it will be easier to see where they best fit into the new future.
- Don’t forget the importance of attitude: Especially in these moments of stress, adding value through skillset is just as valuable as adding value by contributing to a positive working environment. Encourage leaders to show up willing to be part of the solution. M&As offer opportunities for leaders to take on new roles that align with their skills and interests.
“If you stay stuck holding on to your past achievements, you’re not contributing to the new way forward.”
Gut Check for Leaders: How will you help your leaders embrace the changes ahead?
Preparing for and managing the human capital challenges of M&As
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