People issues last on list when companies take part in mergers

People issues are largely being ignored by organisations during mergers and
acquisitions according to research.

A study by Mercer Consulting Group finds that the success of most
transatlantic mergers is measured through financial results, with HR issues
given little attention.

The research, based on a detailed survey of 20 companies, reveals all but
one of the companies measure success by financial performance whereas employee
satisfaction or staff recognition are only assessed by half.

The study also showed that people issues are regarded as the most difficult
to address in a merger or acquisition. Half of the organisations report
creating a new structure for the organisation is difficult to achieve. Four out
of 10 respondents find harmonising company culture difficult to achieve.

Richard Coates, European partner at Mercer said: "Financial results are
obviously relatively easy to measure, but what drives these results is an
organisation’s people. If you don’t address a wide range of people-related,
organisational and cultural issues during a merger, you can be sure they will
come back to bite you."

Three-quarters of the participants cite staff communication as vital to a
successful merger, while seven in 10 highlight retaining talent as crucial.

Coates added: "In a newly merged organisation, the priority should be
to identify and retain those organisations and teams with the right skills and
establish clear roles and objectives for them.

"Experience has shown that the most successful mergers are those where
companies devote significant time and attention to the people issues –
financial results will then follow."

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