Mergers and acquisitions present an incredible opportunity for growth. If not handled properly, they can also be a challenge to growth and success of the organization. So it is essential to understand the role of corporate training in M&A along with the elements to cover in the training. Read on to find out!
Global merger and acquisition deals were valued at $5.9 trillion, and the practice is expected to grow in the next few years. Mergers and acquisitions are a standard part of the business world and involve the peaceful joining of two or more organizations. A merger is when two organizations create a new joint organization, while acquisition involves one buying out the other. Whether it’s a merger or an acquisition, the role of corporate training is integral.
As challenging as it is to highlight the right M&A opportunities and finalize the deal, the real work begins after that. Making the deal a success requires strategic onboarding and monitoring. To facilitate this transition, make sure to provide corporate training to employees because it affects how employees respond to the changes.
Training is Essential in Mergers and Acquisitions
Here are the 7 reasons why:
- Gets employees adapted to the new environment
- Improves communication
- Facilitates the transition
- Helps leaders adjust to new scope of operations
- Optimizes change management
- Minimizes uncertainty and apprehension
- Encourages active participation
This blog will explain the significance of training in facilitating successful mergers and acquisitions and explore the training aspects you need to cover.
Which Training Aspects to Cover for Mergers and Acquisitions
To ensure successful and smooth M&A deals, here are the top 5 things you need to cover in your training programs.
1. Changes in Rules and Policies
Each company has a unique set of defining policies they implement and procedures that they follow in original and subsidiary organizations. So organize multiple training sessions to help employees learn more about the new rules and procedures that will take effect after the merger or acquisition.
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This step is necessary to prevent unintended violations and help employees learn more about what the new setup prioritizes.
2. New Business Processes
Business processes and operations rarely remain the same after an acquisition. Conducting eLearning sessions to transfer the knowledge about new processes can boost engagement and interest of the employees. It is also the perfect way to introduce technical differences without overwhelming employees.
3. Cultural Changes
Each organization has a specific work culture aligned with its vision and values. This culture is central to its operations and existence, but it might require tweaking after a change in senior management. Therefore, it is important to cover this aspect while providing training for merger and acquisitions. It helps employees prepare themselves for change, understand what is expected from them, and how they will deal with it. This task might need consistent training for some time before it shows results, but spreading information in this way can increase awareness.
4. Scope of Operations
Mergers and acquisitions affect a company’s operations the most, often causing an increase in orders and scope. Those managing the merger or acquisition should align all functions with operational changes. So plan training sessions for the purpose well before deal finalization. Preparation is the key to success and can help you overcome challenges.
5. Strategic Alignment and Direction
Lastly, training can help improve the overall alignment and direction of the company. The owner or senior management of one company may have started with specific goals and would have led accordingly so far. But once the leadership changes, the way the company works and the direction it is headed might change.
In such situations, training becomes a great and effective tool to ensure that employees know about the latest strategy and check future growth plans. Alignment is necessary for successful transitions and will help you close the project.
The abovementioned section clearly states the training aspects to cover in mergers and acquisitions. The next step is to learn in detail the role of training in mergers and acquisitions.
So let’s begin!
The Role of Training in Mergers and Acquisitions
A merger or acquisition can be understandably frightening for the employees, especially the latter. They feel like the change would affect their job security and become uncertain about their future growth in the organization.
Such concerns are valid and can create an uncertain environment. However, planning suitable training can guide them through the change and minimize their discomfort about the new beginning. Following are how training facilitates mergers and acquisition success:
1. Gets Employees Adapted to the New Environment
The organization can undergo several changes after a successful M&A deal. Sometimes, the changes are limited to reporting. At other times, they can extend to the core organizational structure. Either of these aspects can be overwhelming, even if employees are prepared for the inevitable shift.
Hence, it is best to organize training sessions to get the employees accustomed to the new settings. For training, you can incorporate the differences in the chain of command, additions or removals of projects, or personnel switch-ups. You can attend to these aspects by providing cross-cultural training, training on integration of new policies and procedures, orientation training, compliance training, etc.
You can also take this opportunity to increase employee knowledge of the two companies, allowing them to become more familiar with its operations, thereby helping them adapt to the new environment.
2. Improves Communication
Leaders and team managers often take the responsibility to inform people of the decision and assure them about the future. But that’s not enough. It is better to start taking the initiative once things become more confirmed. For starters, you can invite people from the other company to work with your employees. This acts as an icebreaker between members, making them more comfortable with each other.
This action will ease the transition, improve communication, and minimize uncertainty about the decision. In fact, it will also enhance communication between employees and leaders, encouraging them to share their concerns so leaders may address them. To improve communication, you can offer soft skill training and train employees on aspects like digital fluency, active listening, non-verbal communication, etc. You can leverage scenario-based learning, storytelling, eLearning, etc., to facilitate these training sessions.
3. Helps Leaders Adjust to New Scope of Operations
Training isn’t only beneficial for subordinates. It is also necessary for leaders who will be leading the change management and transformation initiatives. They must understand the extent of work required for the transition and the optimal timeline for completion.
Therefore, providing relevant leadership training, management training, Diversity, Equity and Inclusion (DEI) training, financial literacy training, communication training, technical training, and non-technical training play a significant role in ensuring effective mergers and acquisitions. Such focused leadership programs will boost their clarity and allow the leaders to transfer the knowledge to their teams. The more aware they are, the better aligned organizational functions will be with the transition.
Check out this video to know more about how you can develop leadership qualities in your employees.
4. Optimizes Change Management
Change management is a multi-step process.
This process is essential for mergers and acquisitions since both organizations would undergo change and need ample preparation.
Relevant training, workshops, and leadership programs for leaders and change managers allow them to widen their knowledge about deal technicalities. You can provide training sessions on company strategy, management processes, communication plan, change management tools and techniques, etc. Imparting information on these topics via corporate training is instrumental for change strategy and affects their contingency plans and timelines.
5. Minimizes Uncertainty and Apprehension
Despite getting painted as a growth opportunity, several acquisitions cause an increase in uncertainties in the acquired business. Employees expect the shift to disrupt job security and become apprehensive about structure, management, and operations changes.
Their sentiments are expected, but they don’t have to last. Providing information sessions, organizing periodic training, and opening communication channels can help reduce this negativity. Facilitating training relevant to new desired skills, company objectives, work culture, etc., can benefit in minimizing uncertainty.
Moreover, you can train employees on virtual collaboration and conflict resolution plays an integral role in successful mergers and acquisitions. Knowing both parties encourage communication, and becoming aware empowers employees, leaving them in a better position to understand ground realities.
The greater this understanding, the less the uncertainty.
6. Encourages Active Participation
You may notice a dip in employee participation levels after announcing a merger or acquisition. It is an expected response that might take some time to change and the duration to get things back to normal depends on employees’ perception of the transition.
To reduce this time gap, training the employees for adaptability and flexibility will make them more confident about strategic and structural changes. You can incorporate training such as onboarding training, soft-skills training, compliance training, empowerment training, etc. Moreover, training employees on team-building skills and inclusive leadership will help them foster a more conducive environment to revert to active participation levels. Employee engagement is always a positive sign and conveys a strengthened image to external parties, such as clients and vendors.
Final Thoughts
Without a doubt, training plays a major role in facilitating a successful, thriving, effortless merger and acquisition. In fact, now you also know the important elements to cover while providing mergers and acquisitions training to employees. Incorporate them in your training programs and be confident in your M&A deals. So what are you waiting for? Explore the opportunities for growth and development via mergers and acquisitions now! Along with that know how L&D and business can align to help you make a great impact in the eBook below.
