Thousands of mergers implode before ink ever meets the dotted line, but those are the mergers no one hears about. The buzz is about those deals that look fantastic on paper, but fall flat in the real world. “My clean up starts after these botched deals close,” says Amira elAdawi, CEO of AMIRA & CO. “Mergers go sour for so many reasons. It’s a challenging time for employees. Is it any wonder they fail to fall in line when life-changing decisions rain down from above and they feel they have no input?”
Mergers fail when consultants come up with all the solutions
Many executives do not want to get involved in the integration strategy that unites two distinct companies during M&As. Most simply want a consultant to hand them a plan and leave. “That’s much easier for me to do, but I don’t believe that is the right answer for most clients,” remarks elAdawi. “It almost never creates lasting change.”
Companies often hesitate to be part of developing the details of an integration strategy because they genuinely feel more comfortable leaving solutions in the hands of “experts”. “I market to clients who believe their teams are capable of creating lasting change,” elAdawi remarks. “The organizations I choose to work with see the value in employees who take long-term ownership of the plan.”
When a team develops its own plan, employees do not feel they are being told what to do. In elAdawi’s opinion, if consultants can enable people to find their own answers, the solutions are always better. “It’s arrogant for any consulting firm to think fresh MBAs are going to have better ideas than the employees who live and breathe their company,” she says. “The ten people we bring to the table are never going to outthink an entire organization. They have the expertise when it comes to their business and sector. We have the expertise from other industries, the technical know-how to analyze the information, and the right questions to ask. If you bring both of these together, you are guaranteed to end up with better solutions.”
When elAdawi leaves a company, the employees believe wholeheartedly in their integration plan because it is truly theirs. They are rooting for it, and they will do everything they can to help it succeed.
Mergers fail due to a clash of cultures
Another crucial element of a merger is the integration of two distinct company cultures. Even the best solution cannot save two companies whose teams just cannot work well together. For mergers to succeed, companies must help each other through the transition.
Involving only a handful of employees in such a pivotal change can be a recipe for disaster. In toxic mergers, the most desirable employees begin to find work elsewhere. People are one of the most valuable assets a company acquires during a merger. Unlike other assets, however, they can walk out the door.
To turn this situation around, consultants need to collaborate and build trust. Unfortunately, consultants often overlook the value of influencing culture. “As a group, we tend to be geeks and nerds,” laughs elAdawi. “Most of us are great with data and analytics, but not so good with people. We’re used to getting information, making decisions, and being listened to.”
In addition to being a consultant, elAdawi is also a teacher and coach. Through experience, she’s learned the value of listening. “I don’t think my job is to come in and demonstrate how smart I am,” she explains. “Client teams often have great ideas for their company and they often know where the real issues lie. They’ve been with these companies for longer than I have. Most of the time, they already know the answer; my job is to help them work together to find it.”
By constantly listening, elAdawi often discovers that one employee has a piece of the answer, while an employee in an entirely different department has another. She unites them and plants the seeds of collaboration. After showing each one the best in their new partner, she works with them to refine a joint solution based on their company knowledge and her experience.
Mergers fail due to the impact of outside market changes
No matter how brilliant an integration plan is, it must adjust when the world throws changes its way. “If you weren’t part of designing that plan, how can you know what impact real-world changes will have on it in six months, a year, or two years?” asks elAdawi.
Consultants often shift blame of a failed integration plan onto clients by highlighting the changes they should have enacted in their absence. “Those companies did not know what changes to put into effect because they weren’t part of developing the plans,” says elAdawi. “The companies I work with are able to pivot because they were part of the decisions.”
elAdawi’s approach with AMIRA & CO is disrupting the M&A industry, and other consultants are reacting. She currently has partnerships with other large firms that want to incorporate her methodology. “Some are embracing these techniques,” she says. “Instead of competing against each other, they’ve asked me to join them as an advisory to help them incorporate this thinking into their delivery approach given how much clients are loving it.” More and more organizations are seeing the benefits of an approach that listens to employees, gives them input, and allows them to take ownership of the process.