Strength in numbers

The business

Ernst & Young is one of the ‘big four’ accountancy and business advisory companies in the world. It is the fourth largest in the UK market. In October 2003, the firm’s central and southern business units merged to form one region, stretching from the East Midlands to the South West. The South region, as it is now known, employs 1,400 staff in eight offices. There are eight people in the HR team.

The challenge

The greatest challenge for HR director Nicki Jefferies was to establish a new team identity after the merger. She pinpointed leadership as the main element in forging this identity. There was an existing leadership group which comprised the division’s senior management, and Jefferies believed that it was essential for this group to understand Ernst & Young’s values, and then to be seen by the rest of the company to be exhibiting them.

However, developing a team identity and instilling common values with a group of 100 leaders was not simple.

Jefferies says: “It was like trying to create a team identity among the England football team. The players spend a couple of days together and play a match, but then return to their clubs, where their local teams have different needs.”

The solution

In January 2004, the company held the first of four quarterly ‘Momentum Days’. All 100 or so directors and partners of the leadership group of the merged division attended for an evening and day.

There were two strands to the programme. First, all the leaders completed Myers-Briggs-style psychometric tests online. The aim of this was to establish personality types to see how people would work together.

“Most people were familiar with the system, and it was a really good way to make people aware of their own behaviour,” explains Jefferies.
“We did consider an emotional intelligence approach, but were put off by the way it scores people. We didn’t want people to feel judged,” she says.

Jefferies asked business psychology firm OPP to help to her to run these sessions. She then divided delegates into groups, each comprising a mix of personality types. She encouraged the directors and partners to understand not only how other people approach issues, but also how they communicate and the affect that impact this can have on other staff.

A series of motivational speakers formed the second strand to the Momentum Day. “We felt we had people’s minds, but we really wanted to capture their hearts as well,” explains Jefferies.

Speakers included Geoff Cook, former coach of the England rugby team, and Stephen Parks, coach of the British Olympic sailing team. One of the most inspirational was Miles Hilton-Barber, a blind sportsman whose achievements include climbing Mount Kilimanjaro, flying a Microlite across the English Channel, and running the Marathon Des Sables, a six-day 150-mile endurance race across the Sahara desert.

Last year, the emphasis of the Momentum Days shifted to growth targets. Ernst & Young aims to grow its share of the UK market significantly by 2009, so the focus of these events moved to support that, according to Jefferies. “We demand that our people are the best in their profession, both technically and as leaders. This is a huge responsibility,” she says.

The outcome

The financial results in the South division showed that turnover grew by 10% in the last year, while staff attrition fell by 2%. Ernst & Young conducted people surveys worldwide in 2003 and 2005, forming the basis for six performance indices. The improvement in results for the UK’s South region is notable. On the leadership index it has risen by 22%, on people commitment by 16%, and overall its score is 6% better than those achieved by the other divisions. Nearly three-quarters of employees in the region are satisfied with their working life.

OPP has also trained Ernst & Young’s senior leaders on Myers-Briggs. Over the coming months and years, this personality-based approach will be filtered through the organisation and could even be used to improve client relationships.

If I could do it again…

Looking back, Jefferies believes there are a few things she would do differently. She says: “I’d practise what we preach about engagement, and look to consult with and involve more of our partners and directors in the formulation and design of the leadership events. I think this would ensure we’re hitting the right buttons and delivering the most effective intervention we can.

She adds: “I’d make sure we give people plenty of time to immerse themselves in the areas we want to focus on. It is more effective to give participants the time to debate the issues and come up with meaningful solutions. It is a rare opportunity to have all the key leaders in one place and so you need to maximise their time together.”

Guide to surviving a merger in 10 steps

  • 1 Look at the chemistry of the management. Can the two management teams work together?
  • 2 Ensure that everyone inside and outside the business understands why the two businesses have merged.
  • 3 Check that the merger will actually increase shareholder value – that it isn’t simply an exercise in vanity.
  • 4 Establish a realistic timeframe for completion and integration of the merger.
  • 5 Develop an execution plan. Both merging parties should have a clear idea of how the first 100 days of merger will pan out.
  • 6 Remember the tax implications. Have you considered all the options and taken the one that will bring the most benefit?
  • 7 Think about how the merger will enable the company to win more business.
  • 8 Pick your advisers carefully. The wrong advisers can destroy up to 7% of the value of the combined organisation, so getting the right ones is vital.
  • 9 Communicate your plans to your employees. Keeping them on board is essential for success.
  • 10 Be positive. Anyone managing a merger is going to have 12 months of hard work and toil. So make sure you enjoy the experience.

Julian Costley is chairman of Aurora Kendrick James

The employee perspective

Cathy Taylor joined the Cambridge office of Ernst & Young in 1987 and is now one of the tax partners there, in charge of a team of 40. Before she attended the first Momentum event in January 2004 she had done some Myers-Briggs work and so was pleased to see it used again.

She recalls: “It helped me to stop assuming that everyone will take away the same conclusion from the same facts. It also made me aware of what type of presentation style I respond to best, and so helped me to be less critical of different styles.”

Taylor was so impressed with it that she asked Jefferies to run a training session for her staff. She says: “It’s been really useful in helping us all work together more effectively. For instance, there’s another manager who is the opposite type to me, so we work closely together in formulating any message that we need to deliver to the team.”

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