Leave the guns at home: communicating to employees during an acquisition

After a brief, COVID-fueled hiatus in the first half of 2020, mergers and acquisitions are back on track to rebound globally, according to PwC. As organizational changes go, acquiring a company is like parents preparing for the birth of their first child; no one really knows what to expect. But good communication can play a big part in whether newly acquired employees feel like valued members of the family – or Harry Potter sleeping under the stairs.   

So here’s a short list of communication do’s and don’ts for a successful acquisition: To start, don’t let employees first hear about the transaction from the media or any other external source. Take a close look at how well the two cultures may actually mesh together. Sync up the messaging to all audiences and give leaders at every level the resources they need to deliver it. Be straight (always!) with employees – and don’t even think about bringing in armed guards when the deal closes (more on this later).

Stay ahead of the news

An acquisition is a sensitive, potentially market-moving event, so it’s legitimate for companies to carefully manage the flow of information about it. That said, if employees learn about a deal from the media before hearing directly from their leaders, it can tank their trust in the organization. Early in my career at Thomson Reuters, news of an acquisition we were planning in Latin America was leaked by the owners of the acquired firm before our scheduled joint announcement. Employees on both sides panicked and we had to scramble to respond, which created bad blood all around. The lessons were clear: 1) always assume that information can, and will, leak; and 2) have a contingency communications plan in place, with messages and Q&A, that can be activated on a dime.

Culture trumps everything

When acquisitions fail, it’s often due to a cultural mismatch – and communicators (together with our HR colleagues) can help identify these differences in advance through a culture audit. One pre-acquisition audit we conducted found that while both companies saw themselves as customer-focused, the acquiring firm defined this as “staying ahead of the curve with respect to client needs,” while the acquired company viewed it as “responding immediately to clients’ concerns” – distinct definitions that reinforced very different behaviors. The audit surfaced this insight about the respective cultures, which helped leadership bridge the gap and redefine how the combined business would manage customer relationships after the deal closed.

Measure twice and cut once

An acquisition impacts a range of stakeholders, directly or indirectly. There’s a lot on the line – for employees, customers, partners and investors – so it’s critical to map out a tight sequence of targeted communication that delivers what each audience needs to know. The level of detail required can be painstaking: one communication plan we developed for a global outsourcing deal delivered 14 separate messages to 26 discrete audiences within the first 48 hours (most within 15-minute increments) and involved 30 written deliverables. The most important element was preparing leaders: anticipating and answering questions from employees, especially about layoffs and other job changes; developing a shared narrative about the rationale for the acquisition; and providing training on fundamental communication techniques.

And…leave the guns at home

When I ran internal communications at McGraw-Hill, we’d bought a large publishing company and decided to shut down an old printing plant in the Midwest, where many of its employees had worked their entire careers. Fearing a violent reaction to the announcement, some on the management team suggested we hire armed guards to escort people from the workplace; others thought this would incite the very behavior they were trying to avoid. The cooler heads prevailed and we opted, instead, for a series of frank conversations with employees about the business rationale for closing the plant. While they didn’t like the message, they understood it, and they especially appreciated management’s candor. Employees can handle bad news; what they despise is being patronized or disrespected. Treat them as mature adults – and that’s how they’ll act in return.

An acquisition can be a major change for employees on both sides of the transaction, and neuroscience tells us that our brains evolved to perceive changes in our environment as potential threats. As change management expert Hillary Scarlett put it, in earlier times, “…if the saber toothed tiger got you, that was it, game over…which is true in the workplace as well. The saber toothed tiger is now the uncertainty of a change program….” Good communication, then, becomes a crucial link in taming some of the inherent ambiguity that comes with an acquisition and smoothing the transition to a new, and hopefully more successful, organization.