Communication is critical during a merger or acquisition. A successful M&A communications strategy will account for both internal and external communications to provide rationale of and value from the move and to maintain transparency with employees who might fear for their jobs or wonder what the move means for them. Here are the top five needs companies should build into an M&A communications strategy to keep employees, shareholders, customers and other stakeholders informed and, hopefully, to view the transaction as a positive and exciting outcome.
1. Centralized Internal Communications
It doesn’t take long for communications to break down in the workplace during the M&A process. All too often, incomplete intelligence is shared and rumors fly as staff and employees try to figure out why and how decisions are made and those decisions impact them. To mitigate the game of telephone and speculation, establishing an immediate and centralized communications source—both in terms of spokesperson and the channel through which they communicate—sets expectations for where and when workers can get official information and related materials.
Most often, organizations will leverage CEOs or another high-level executive to serve as an early spokesperson for essential information. Consistency, continuity and accessibility of initial and subsequent information becomes key for its efficacy and uptake. Making official details, documents or communications available by bookmarking them on or sharing them through the company intranet or other internal platforms ensures workers can locate resources for their questions.
Finally, for internal communications to be effective during the M&A process, organizations must provide the information people want. Open and clear provision of essential information about M&A details—the who, why and whens—from an official company source will minimize confusion and maximize accuracy of information.
2. Employee Impact Statements
The main question employees have about an M&A announcement is how it will impact them. For employees, there’s an inherent uncertainty that they may soon be without jobs—an uncertainty that, if left unaddressed, compounds into a combination of fear and anger.
Providing clear employee impact statements early in the process that answers typical questions about strategic direction, reorganization and overall job security will at least provide transparency that employees want, and at most leaves employees free of anxiety and fear of the unknown. Below are some of the most frequent employee questions around mergers and acquisitions.
Do You Anticipate Layoffs?
Often, mergers or acquisitions result in layoffs for “redundant” employees between the two organizations. For example, you might not need two full human resources departments or IT teams for the new company. On the other hand, sometimes when a struggling company is acquired by one that is more stable it leads to increased investment in employees and stronger retention strategies rather than layoffs. Make sure employees know what to expect regarding layoffs, retention or growth as the transaction moves forward.
How Will the M&A Process Impact Job Roles and Functions?
During the M&A process, employees often need to take on a variety of job tasks that would not normally fall under their purview. Delineating what new responsibilities are expected of them, and which of those tasks will be temporary or permanent, is important information for employees. Make sure your organization is able to assess and explain employee responsibilities after the deal is final and well beyond.
How will the M&A Affect Employee Salaries and Benefits?
Sometimes, the M&A process will result in changes to employee salary and benefits. Employers may increase salaries for employees from the lower-revenue organization, creating great incentive to stay after transaction close. Employees may also experience better benefits after being acquired by larger corporations. Perhaps there will be no change to benefits or salaries for employees. Still, other M&A processes will result in changes in benefits that could be perceived negatively or even entire salary restructuring. Regardless of how employee benefits and salaries will be affected, they need to know the specifics of M&A impact on their income and resources as soon as possible.
3. A Client Benefits List
As part of the M&A process, take the time to lay out how the merger or acquisition will actually benefit your clients. Will they:
- Get better overall customer service?
- Have access to more services from the same provider?
- Experience better localization or fewer delays in seeking service?
Often, a merger or acquisition will make clients nervous, especially if the company’s standards or structure will change significantly during the M&A process. For example, clients who have chosen a small business for their needs may feel hesitant when a bigger company takes over. By putting together a clear client benefits statement, companies can help alleviate customer concerns and build a higher level of confidence in the company and process.
Organizations should make the client benefits document available as a messaging resource for employees as well. Consider creating an M&A quick facts sheet or an FAQ for client-facing communications and storing it in the same place as internal resources on the merger details and employee impact. Equipping your employees with convenient materials will encourage cohesion in external messaging and ensure that clients are not receiving disjointed information.
4. A Plan for Other Stakeholder Questions
Employees and customers aren’t the only ones who will have questions when two companies merge. The transaction would likely also affect shareholders and institutional investors if one or both of the companies are public, as well as attorneys, finance teams, contractors, vendors and others. It’s important to take the time to think through your various stakeholder groups and their probable questions, then have a plan in place for answering those inquiries ahead of time through proactive outreach, FAQs, pre-approved quotes from designated spokespeople, social media and communications through other standard channels. Having thoughtful, prebuilt answers will prevent companies from scrambling to come up with information, and demonstrates you’ve carefully considered M&A impact and are doing everything in your power to make it a smooth, successful process.
5. A Media Strategy
Announcing a merger or acquisition to your industry and the public is obviously very important. To maintain control of your announcement, you need a messaging and media strategy that allows your organization to release information at the right moment and in the most impactful places. Consider:
- Why have the organizations decided on a merger or acquisition? Why is this important to the market and what solutions does the M&A introduce to widespread challenges or needs?
- What are the specifics of the merger agreement? What can you share with the public?
- What is changing about the company or companies that you may need to highlight? Is strategic direction changing? What’s the new company’s vision for the future? What are its mission and values? What is its universal value proposition? Will the company enter markets, target new stakeholders or pursue growth in new categories?
Once you’ve figured out the specifics of what you’d like to announce, consider the strategy for amplifying your announcement:
- Are there any key publications or outlets you want to cover your announcement? Do you want to offer an embargo to any of them?
- What channels will you focus on before, during and after the M&A process? For example, issuing press releases, leveraging social media platforms, briefing market research firms and industry analysts?
- What timing makes sense for the announcement? What is a strategic communications cadence following the release? How do you capitalize on coverage of the transaction to build momentum and communicate growth and value?
