Strategies & Tactics

Come Together: Ensuring Smoother Merger-and-Acquisition Planning

January 3, 2019

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When companies plan mergers or acquisitions, they often overlook communications, leaving it as the last function brought into the fold. But how well the story of the deal is communicated can impact the return on investment.

The right communications strategy, messaging and execution for a merger or acquisition help boost stock prices and investor confidence, gain customer acceptance and increase employee morale. But when communications are not carried out properly, these same factors can spiral out of control and undermine the deal.

I’ve been fortunate to be part of the due diligence process for acquisitions, and have had the opportunity to influence those teams on the importance of communications and preparing in advance. I’ve also observed what happens when the communications team isn’t notified until right before a merger or acquisition is announced: They’re given no time to consider all the stakeholders the deal will affect — usually resulting in confused and panicked employees, negative press coverage and audiences left uninformed about the deal’s value.

Here are some tips to help you develop and execute engaging communications at every step of a company merger or acquisition, from when the deal is first announced to when its integration activities are complete:

Plan messages.

Work with executives and your company’s integration-management office to start planning communications well in advance of when the merger or acquisition will be announced. A well-thought-out plan and proactive messaging can determine whether your audiences will accept the acquisition. Communications should support the rationale and overall business strategy behind the merger or acquisition.

In your communications, consider incorporating elements of the vision, values, brand strategy and positioning of the company being acquired. This goes a long way toward winning over that company’s customers and employees. Evaluate what you want the new, combined company to stand for and the experience that others will have with the business, and then develop an appropriate brand-transition plan.

It’s important to create messaging narratives for each audience — such as employees, customers, partners, investors, press, suppliers, union reps, lawmakers and regulators. Communications should help all of them understand the deal’s strategic value, its reason and how it will affect them. Once you’ve created narratives for each audience, the messaging can also be used by the leadership team, spokespersons and managers.

Align strategies and involve employees.

Companies involved in a merger or acquisition need to align their media strategies. Allow enough time to connect the respective PR teams, so they can decide how they want to announce the deal.

You might conclude the best strategy is to provide an exclusive story to a top-tier media outlet. But this approach could mean that other important media organizations don’t cover the announcement at all. Before deciding on the PR strategy for announcing the acquisition and merger, make sure you understand both companies’ goals.

At my firm, we recently decided to work closely with local media to announce that a Chinese company was acquiring two manufacturing plants in the United States. The company needed the support of local communities and did not want national media attention for the story.

Employees are the key to any successful integration, so make them feel empowered and part of the process. Solicit their input early so you can develop a baseline of employee perceptions, concerns and opportunities. Soon after the acquisition closes, conduct another survey of employee attitudes and perceptions.

To engage employees, also partner with your information technology and human resources departments. Before and after a merger or acquisition, the communications team should work with HR and IT to issue frequent communications to employees. Written forms such as newsletters and memos can help, but whenever possible, in-person communication is still the best method. Arm and train managers with tools they need to answer employee questions and minimize rumors.

Combine digital assets.

It’s difficult to imagine how many webpages will need to be revised to reflect the stories of the combined companies, so it’s best to create a phased approach to integrating digital assets such as websites and social media accounts. Linking sites and accounts and creating promotional banners about the merger are good first steps.

Once the two companies start integrating, decide on a common website platform, user interface and design. Assemble a team that will inventory content, create a site map, and decide what to change for the new website and when. Your social media channels and accounts can also be slowly integrated to bring old followers to the new platforms, before the old accounts are removed.

Plan Day-1 actions.

Once the merger or acquisition has been announced, hold regular planning sessions to develop Day-1 actions and a longer-term plan. Meet with other departments proactively to understand their plans and milestones. Doing so will help ensure a coordinated and timely delivery of the various communications leading up to, during and after the integration phase. These communications will cover a wide range of activities and purposes, such as external investor conferences and meetings, managing customer expectations and experience, providing the sales team with materials they need, and making sure employees receive information that empowers and motivates them.

You’ll also have to decide what the communications function will look like on Day 1 of the new company. Determine which communication vendors and tools are duplicates and therefore redundant. These decisions should be thoughtful and made with the combined company in mind. Remember that the acquiring company’s resources might not be best for the new organization.

Understand risks and assign accountability.

Scenario planning will help you foresee possible risks and issues for both companies. It’s important to be prepared with action plans and holding statements, in case those scenarios should arise after the merger.

Finally, determine accountability for your integration communications. Assign an internal owner and/or hire additional short-term help from outside the company to oversee and execute integration communications. That way, you’ll protect the existing team from becoming sidetracked, overburdened or slowed down by the company’s normal, day-to-day operations. 

With global and U.S. merger and acquisition activity hitting an all-time high during the first half of 2018, communications teams in industries ripe for M&A activity — such as adtech, blockchain and fintech — should start engaging with their leadership teams to plan early for successful deal announcements and integrations.

Michele Landry

Michele Landry is principal of Tanis Communications and leads its M&A practice. She has helped lead communication strategy and execution for several mergers and acquisitions.

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