When Covid-19 tightened its grip on the world last March, my company, Unanet, was deep into the process of integrating a company we had acquired the previous October. Months later, the pandemic still raging, we announced another acquisition, knowing full well the prevailing limitations on conducting business in-person could hamper the vital work of coalescing the newly acquired company with our own.
To say the Covid-19 pandemic has been disruptive to our integration efforts would be an understatement. But even in the throes of a pandemic, meshing the people, processes, infrastructure, products, customer base and most importantly, the culture, of an acquired company can be done — and done well, if a little differently than in “normal” times. With M&A activity projected to increase in 2021 after a downturn in 2020 and pandemic-related limitations likely to linger well into this year, here’s a look at some of the integration practices I have found to be particularly effective in these unusual times:
1. Maintain an unwavering focus on both companies’ customers. An acquisition can put customer relationships at risk. Stickiness will come not only by communicating consistently and transparently with the acquired company’s customers about how the acquisition will enhance the value they receive, but also through actions by your organization that help them to succeed and get more from their existing products, without pushing them to invest in new product. With the pandemic increasing the pressure on businesses to maximize efficiency and resources, helping them in that undertaking is a powerful way to build and sustain the customer relationships that will enable your newly integrated business to thrive.
2. Target a company with a healthy culture that closely aligns with your own. Beyond the product/service fit between two potential partners, it’s also critical to ascertain if their cultures will mesh well. What stated values do the organization you’re considering acquiring espouse and aspire to? How and to what extent do those values actually manifest? Talent retention, employee engagement, the capacity to innovate and to deliver value to customers — these are all critical components of culture. So you want to be confident the cultural fit will be snug.
3. Get an early jump on integration. Connect functional leaders in the two organizations as soon as feasible, preferably early in the due diligence process, so they can gain familiarity and begin to collaboratively develop and implement an integration plan well before closing.
4. Invest in best-in-class communications tools across the organization, then use them to their fullest. Our decision to invest in full-featured versions of Slack, Zoom and other communications platforms was instrumental to Unanet’s successful integration of Clearview Software, particularly once the pandemic hit. My leadership team and I made constant check-ins a top priority, via one-on-one’s, small groups, all-hands, team-building events and CEO roundtables where everything was fair game for discussion. Through it all, we welcomed and acted upon feedback from across the organization, while consistently conveying to people how combining the companies would ultimately benefit them, why the acquisition made sense, and how we intended to invest in them going forward. To strengthen the feedback loop and keep a finger on the pulse of employee morale, mindset and engagement, I’d also recommend digital tools that measure employee experience.
5. Don’t disrupt. People have dealt with enough tumult in their lives lately. Don’t add to it by trying to fix what isn’t broken. Instead, make it a priority to preserve the positive aspects of the acquired company’s culture and enhance it with your own. Make sure incoming employees understand you’re here to provide them with new shared services.
6. Treat it like the recruitment that it is. Getting people excited about the pathway they, and the newly integrated company, are on can be especially challenging in a remote working environment. So let your employees know how you plan to invest in and empower them in their work. Find ways to rally them around the organizational ethos by connecting them to a greater purpose. Offer a vision for how they can advance within the organization. And make sure the incoming sales force has an appealing comp plan. Because during a crisis and otherwise, an engaged, empowered workforce is your most important competitive asset.