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Mercer's reflections on M & A: Capturing the value of the deal

Last updated: 18 March 2007

 

Robert A. Bundy
Global Leader, Mergers & Acquisitions
Mercer Human Resource Consulting

 

To our readers

 

Business pages around the globe continue to report a steady flow of merger and acquisition activity. But, depending on which research paper you read, anywhere from 50 to 80 percent of mergers and acquisitions never produce their anticipated benefits. In the wake of this research, a plethora of articles and books described the reasons behind deal failure and suggested how to succeed in deal making.

 

Practically speaking, once an organization gets past the “reasonable price paid” evaluation, only effective planning and execution will deliver a deal’s expected value. Theory may influence the plan, but practical processes, tools, and knowledge enable the execution. And most organizations rely on their people to develop and execute those plans – both as extended members of deal teams and as employees required to deliver value to the post-deal organization. In other words, your deal’s success depends on your people.

 

Mercer's compendium of articles - Reflections on M & A - addresses issues commonly faced in both domestic and cross-border transactions. For example, human capital analytics can and should be used to provide a sound and quantitative rationale for decision making. And, as you’ll read, local knowledge is also critical, particularly in Europe and Asia, where legislative, regulatory, and cultural complexities can derail otherwise promising transactions.

 

In collaboration with finance, legal, and operations, the human resource function is best equipped to navigate the difficult people challenges – before, during, and after a deal. HR brings a valuable perspective on leadership, organizational engagement, employment practices, governance, and reward structures that can significantly improve the likelihood of a deal’s success. But to be viewed as a valued member of the leadership team, HR needs to be ready – before a transaction is even announced.

 

We hope these articles provoke thoughtful discussions at your organization and provide practical guidance for helping you realize the full value of your next deal.

 

 

 Robert Bundy

 

 

 

Mercer's compendium of articles - Reflections on M & A - addresses issues commonly faced in both domestic and cross-border transactions. You can download the complete file with all five articles or download each of them below.

 

 

 

 Download Reflections on M & A

 

 

Making the most of M&A due diligence: Paving the way for a smoother, faster integration

Robert A. Bundy

 

 

 

M&A activity continues to escalate – not just in the US, but globally. Companies involved in these transaction shave the opportunity to take a different approach to the entire due diligence process, including the increased involvement of HR professionals. If they do, they will achieve a much better outcome and increase the odds that the overall deal will succeed.

 

 Download PDF of article

 

M&A in Asia: Preparing for successful people integration

 

Hiro Nishiguchi, Sunit Sinha, and Allen Wu

 

 

 

The countries in Asia present a wide variety of M&A opportunities and challenges. Japan is the secondlargest economy in the world after the US, while other Asian countries are among the fastest growing. Employment practices and national cultures are spread across a wide spectrum.

 

 Download PDF of article

 

Deal making is back. Is HR
ready?

 

Doug Brown and Moira Donoghue

 

 

 

After a few quiet years, merger and acquisition activity is humming again. How well will people issues be handled this time around?

 

A big part of the answer depends on HR. If HR is “deal ready,” key employees and leaders will be more likely to stay, remaining engaged in making both the deal and the underlying business successful. People-related savings and opportunities for creating new value are likely to be realized sooner rather than later. But if HR is not ready, employees are more likely to leave, taking industry knowledge and customers with them.

 

 Download PDF of article

 

 

Workforce severance and restructuring in Europe: Pitfalls on the people side of M&A

 

Stuart Benson and Robert A. Bundy

 

 

 

As M&A activity continues to accelerate, many firms are finding their domestic acquisition options limited or tapped out. As a result, a growing number of companies and private equity firms are looking to Europe for deals that will fuel their growth, expand their reach, or create new synergies. As they do so, these would-be acquirers should understand that Europe poses challenging workforce issues – notably, its complex severance and restructuring protections.

 

 Download PDF of article

 

 

Making acquisitions work: Human capital aspects of due diligence and integration

 

Haig R. Nalbantian, Richard A. Guzzo, Dave Kieffer, and Jay Doherty

 

 

 

 

Strategic acquisitions are driven by many legitimate business purposes: to achieve profit growth; gain advantages of scope or scale; acquire complementary skills or resources; or capture an important technology, distribution arrangement, or competency. Yet these combinations often fail to deliver the promised gains. Depending on the research cited, 50 to 80 percent of acquisitions never produce the anticipated benefits.

 

 Download PDF of article

 

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