Mergers and Acquisitions - The Value of HR After the Deal
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©The Miller Group 2011 Mergers & Acquisitions The Value Role of HR Before and After the Deal Presented by Adrianne Miller Founder, The Miller Group HRS Sponsored by
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Mergers and Acquisitions - The Value of HR After the Deal Oftentimes it's an alluring, seductive business proposition—Mergers and Acquisitions. And as the economy strengthens, the number of them brewing is on the rise. That can add big dollars to companies' bottom lines. But, did you know that, on average, only about 30% of acquirers actually pull off a successful deal? M&A is a complex endeavor with considerable room for deals to fall apart. Human resources' role in the due diligence and integration processes has the potential to better define where the actual value is in a deal beyond mere 'synergies' and pay and benefits integration. These unique HR-driven insights can add a significant, critical perspective to executives who rely on deep data that get to the heart of why (or why not) to move forward with a merger or acquisition. In short, there's a lot more room for HR to support value creation in M&A than you may have originally thought. In this one-hour webinar, participants will learn how to apply M&A concepts to the due diligence process and post-integration initiatives. The following topics will be discussed: • The critical role you can expect to play with respect to due diligence prior to a merger or acquisition • How to integrate and join forces following the merger o What makes the difference o The key factors that drive success o Strategies for getting stakeholders on board so you can bring about positive results o Communicating effectively before, during, and after changes take place • Applying basic merger and acquisition principles to other organization change initiatives WHEN: Tuesday, January 15, 2:00 – 3:00 PM (ET) Click to register now. ----------------------------------------- ABOUT THE SPEAKER Adrianne Miller Founder, The Miller Group HRS Adrianne Miller is principal and founder of The Miller Group HRS, a provider of strategic human capital advisory services connecting human capital strategy to business strategy. She has over 30 years of strategic and practical human resources experience and has significant experience leading organizations through due diligence and integration during successful mergers and acquisitions that create value for the organization. Adrianne currently serves on the Board of Directors of Big Brothers Big Sisters of Southeast Pennsylvania, and on Virtua Hospital's HR Board Committee. An accredited Certified Compensation Practitioner, she also serves as an editorial board member for the Employer Resource Institute’s California Employer Advisor publication.
Transcript of Mergers and Acquisitions - The Value of HR After the Deal
©The Miller Group 2011
Mergers & Acquisitions The Value Role of HR Before and After the Deal
Presented by Adrianne Miller Founder, The Miller Group HRS
Sponsored by
©The Miller Group 2011
Acquisitions & Mergers: Change Management in Overdrive
Acquisitions
Mergers
Consolidations
Reorganization
Spinoffs
Breakups
IPO’s
Hostile Takeover
Private Equity Investment
Divestitures
©The Miller Group 2011
Acquisitions & Mergers: Realizing Value
What we will talk about • The critical role you can expect to play with respect to due diligence
prior to a merger or acquisition
• How to successfully integrate and join forces following the merger.
• What makes the difference
• The key factors that drive success
• Strategies for getting stakeholders on board with the change, so you can bring about positive results
• Communicating effectively before, during, and after changes take place
• Applying basic change management principles to mergers and acquisitions
©The Miller Group 2011 ©The Miller Group 2011
The Basics
©The Miller Group 2011
Acquisitions & Mergers: The Basics
• What is the desired outcome of the acquisition - the end game?
• How will the desired outcome be accomplished - what is the plan?
• Who needs to buy into the changes resulting from the acquisition?
• Who will the changes impact?
• How will people impacted by the changes be affected?
• What will be communicated and when will it be communicated?
• How and to who will you communicate the changes?
• What will you do to ensure the acquisition integration is expertly executed?
©The Miller Group 2011
Acquisitions & Mergers: A Strategic Context
To understand how HR drives value for the business and its role when companies combine, we need to put Human Resources’ strategy in context with business strategy
©The Miller Group 2011 ©The Miller Group 2011
Putting HR in Context
©The Miller Group 2011
BEST
BUSINESS
PARTNER
BEST
BUSINESS
PERFORMANCE
BEST TEAM
& TALENT
CUSTOMER
LOYALTY &
MARKET
SHARE
Mission
Strategy
Values
Culture
The Basic Model
©The Miller Group 2011
Acquisitions & Mergers: Pre–Diligence Questions
• What are the strategic goals of the merger?
• How is “x” company’s culture/values similar to or different from ours?
• What will the org chart of the combined organization look like?
• Do we have a clear understanding of how diligence, integration and the strategic goals of the merger are related?
©The Miller Group 2011
The Goal for HR Is: The Best Team & Talent
• The right people
• In the right place
• At the right time
• With the right skills
• And the right support
• Doing the right things
To support a successful merger or acquisition outcome
©The Miller Group 2011
Acquisitions & Mergers: The Best Team &
Talent Must Align with the Organization’s Goals
For an organization to reach/exceed its target performance expectations all human resource processes and systems must be aligned with the stated values, goals and strategies of the combined organization.
©The Miller Group 2011
JOB
KNOWLEDGE
SKILLS
&
ABILITIES
TALENT
ACQUISITION
&
STAFFING
COMPENSATION
&
STRUCTURES COMPETENCY
BASED
EDUCATION &
TRAINING
PERFORMANCE
MANAGEMENT
TALENT
ASSESSMENT
SUCCESSION
PLAN
ORGANIZATION
STRUCTURE
BEST TEAM
&
TALENT
Acquisitions & Mergers: Diligence In Support
Of The Best team & Talent
©The Miller Group 2011 ©The Miller Group 2011
Diligence
©The Miller Group 2011
Diligence: Document Request
Initial diligence document requests typically focus in areas that will confirm the valuation of the target company or uncover liabilities that could impact the value of the deal. Typically initial diligence document requests include:
- Organization structure - Compensation plans
- Employment contracts - Benefit plans
- Separation agreements - Policies
- Outstanding legal claims and actions - Stock plans
- Performance management systems - Turnover rates
This initial diligence process is most likely your first look at the culture of the company you are considering acquiring
©The Miller Group 2011
Diligence: Document Request/ Culture
Your first look at the culture of the company you are considering acquiring is the beginning of the change management process planning should the diligence result in an offer that is accepted.
During diligence look and listen for clues that will help you identify culture fit
• Leadership style
• Communication style
• Decision making processes
• Workflow processes
©The Miller Group 2011
Diligence: Clues to Culture
During diligence look and listen for clues that will help you identify culture fit
• Leadership style • Is it autocratic or participative • Is it collaborative
• Communication style • Is it top down, bottom up, or both
• Decision making process • Is it top down, bottom up, or both • Is it flexible
• Work flow processes • Are they cumbersome or streamlined • Are they flexible • How are they decided upon
• Values • Does the organization have similar stated values and do they live
those values
©The Miller Group 2011 ©The Miller Group 2011
Integration
©The Miller Group 2011
Integration: The Plan
• As the diligence process is being completed note issues that will need to be addressed in integration.
• Develop an integration outline and plan specific to each acquisition and taking into consideration resources on both sides of the deal.
• While customized, in a typical integration plan
• There is an overall steering committee tasked with integration
• The HR integration lead is responsible for facilitating a smooth and timely integration
• The HR integration lead is responsible for bringing issues forth that could impede progress
• The HR Integration lead is responsible for ensuring transition milestones are met
©The Miller Group 2011
Integration: The Plan
• What is the desired outcome of the acquisition - the end game?
• How will the desired outcome be accomplished - what is the plan?
• Who needs to buy into the changes resulting from the acquisition?
• Who will the changes impact?
• How will people impacted by the changes be affected?
• What will be communicated and when will it be communicated?
• How and to who will you communicate the changes?
• What will you do to ensure the acquisition integration is expertly executed?
©The Miller Group 2011
Integration: Communications
• Where the deal stands will impact your communication plan. Have a clear understanding of where the deal stands
• Letter of Intent
• Government approval necessary
• Final documents signed
• Special communication considerations may apply if either or both companies are publicly traded
• The messages to employees, customers, vendors, distribution channels, shareholders, and other stakeholder’s needs to be consistent and coordinated
• Commit to keeping employees informed about everything that effects them on a regular basis
• Ensure stakeholders have a vehicle and an opportunity to ask questions.
©The Miller Group 2011
Integration: The People
• Who will be leading the organization?
• What is the timing of the people decisions?
• How will decisions about staff selection be made?
• What is the process?
• Will it be perceived as fair and even handed?
• How will decisions be communicated?
• How will those leaving the organization be treated?
• Who are the opinion influencers and how will you engage them?
• How will you measure/monitor progress?
©The Miller Group 2011 ©The Miller Group 201
Integration: The Tactical & The Strategic
Strategic
Tactical
Nat
ure
of
Act
ivit
y
Imp
act
on
Bu
sin
ess
Ou
tco
me
s
Low
High
Compensation Program Integration Performance Management System Integration Training and Education
Benefits, Payroll and Salary Administration Integration
Benefit Plan Design, Policy Development and Job Design
Organization Alignment Organization Development Organization Design Planning Talent Assessment and Planning and Selection
©The Miller Group 2011 ©The Miller Group 201
It’s about achieving the strategic performance goal of the merger or
acquisition and realizing value for your organization, its customers and its
people
©The Miller Group 2011
BEST
BUSINESS
PARTNER
BEST
BUSINESS
PERFORMANCE
BEST TEAM
& TALENT
CUSTOMER
LOYALTY &
MARKET
SHARE
Mission
Strategy
Values
Culture
The Model
©The Miller Group 2011 ©The Miller Group 201
Thank You!
Adrianne Miller The Miller Group HRS, LLC. Newtown Square, Pennsylvania 215.327.4359 | [email protected]
Questions & Comments
North America’s leading affordable, virtual outplacement service 302.352.0511 | www.careerminds.com
This program, ORG-PROGRAM-130842, has been approved for 1.00 (General) recertification credit hours toward PHR, SPHR and GPHR recertification through the HR Certification Institute. Please be sure to note the program ID number on your recertification application form. If you did not attend the LIVE webinar, you are ineligible for HRCI recertification credit.
