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cultural-due-diligence
If you’ve ever taken a used car to your mechanic for a complete check-up prior to purchasing it, you understand the value of soliciting expert evaluation before you invest hard cash. The same is true for mergers and acquisitions.
Identifying specific risks and assessing the operational components of the combining organizations ahead of time will save you weeks of frustration later. MergerCoach analyzes 18 key touch points between buyer & seller that must be carefully assessed during due-diligence to ensure you price your deal right and reduce transition risk exposure to:
1. Organizational size and management power differential
2. Transaction value & size
3. Transaction currency (stock/cash) used
4. Integration planning during due-diligence
5. Level of integration for complete transaction
6. Disparate cultures, geography & languages
7. Relative market position and/or ranking
8. Level of M&A experience
9. Overall corporate strategy
10. Opportunities for internal benchmarking & best practices
11. Relative market confusion/expectations
12. Expected impacts on your customer base during the transition
13. Effects on one-time and recurring costs
14. Speed of decision-making processes
15. Impacts on current or planned projects
16. Attrition exposure
17. Organizational change tolerance
18. Capacity of management team to achieve results during and after transition
The MergerCoach Risky Business™ instrument measures your exposure in each of these areas and offers preventive action items for each of the 18 touch points.
After surveying key customers, suppliers, executives and employees, your executive team will receive documentation and a high-level briefing summarizing findings on each of the critical touch points into four critical transition & operational risk areas: clarity of transition performance metrics, communications effectiveness, customer & markets impacts, business structure and organizational effectiveness. The value to you will equal or surpass at least three times the cost of the review. If we don’t meet this expectation, you pay only associated expenses. It’s the MergerCoach way.
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Executive Coaching
During the significant changes that a merger or acquisition event brings, your leadership must have coaching to help them refine, retool, and invigorate their game. We all need a safe ear when things are changing rapidly. Changes tend to bring “relative truth”—the truth can change on a moment-by-moment basis, as new facts are known and new options revealed. It is crucial to have a personal relationship with a solid businessperson who has been where you are and knows what pitfalls you should step around. MergerCoach offers individualized coaching for this very reason. You choose your coach. You determine the level of involvement. We believe in the power of coaching so much that we stake our fees on our clients’ success.
There are three primary goals for our coaches. They are to:
- Round off individuals’ edges
- Align an individual’s style to the transition process being used
- Help executives succeed by validating their strategy and offering an experienced perspective on key decisions
Still have questions about coaching? Check out these Frequently Asked Questions for more information.
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Communication
CommunicationLink™ is a proven system that, when used during times of significant change, engages all employees, delivers key messages at the appropriate time and in the appropriate manner, and facilitates the deployment of the new strategic vision.
CommunicationLink™ focuses on three main categories of communication necessary during times of great change. MergerCoach works with our clients to customize a solution that effectively addresses these critical areas:
1. Strategic – What is the new vision for the organization?
2. Organizational – How will the organization’s structure shift?
3. Operational – How will the day-to-day operations be affected?
Getting the word out to the organization – sooner rather than later – that these issues are being addressed will keep your employees focused on maintaining productivity, rather than on speculating as to what’s around the corner. People can rally around a vision as long as they understand what tomorrow holds and how that impacts today.
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Transition Management
Strategy Implementation
The primary results achieved within Strategy Implementation are to:
1. Drive out the key products, services, and target markets for the ensuing two to
three-year window
2. Understand, agree on, and articulate the basic organizational beliefs
3. Craft a formal Product Roadmap
4. Plan for the successful implementation of the determined Strategy
5. Drive out a communications plan to inform, encourage, and inspire all stakeholder
areas.
Taking a close, critical look at the competition, your organization’s strengths and weaknesses, and what the perceived potential is for the future will do much to ensure your transition’s success.
Five-Step M&A System™
"We knew 'it' would be a no-brainer, but we honestly didn't know what 'it' entailed. Once MergerCoach painted a vibrant picture of the entire integration process, we were genuinely terrified. Thankfully, MergerCoach's process was well-suited to help our team meet each critical area of concern during our transition."
-Sue Thompson, Vice President, InFocus
The driver for all M&A deals is value. But “value” is one of those highly misunderstood words. What MergerCoach means by “value” is the sum total of an organization’s hard assets, manufacturing capacity, research & development capability, combined sales efforts, and people.
Only two of these areas serve as monumental contributors to overall deal success, or deal value: Sales and people. Often, executives head to the factory to count all their hard assets, or head to R&D to revamp their processes, all the time neglecting to engage and manage the folks who keep the business running: the people. The Five-Step M&A System™ places heavy weight on these two areas for one reason only: that is where the value is either gained or lost.
Consuming the Five-Step M&A System™ means engaging 100% of your population in the process of transitioning to the go-forward organization. This system calls for a temporary operating structure that includes a Steering Committee, Integration Team, and functional Task Forces that remain in place for a 90-day period. These teams are tasked with tackling tough business issues and then making recommendations regarding sustainable improvements. The primary results achieved in Five-Step M&A System™ include providing a critical, functional analysis of the current and future operational systems; and reconfiguring of internal systems to support the integration strategy and business structure criteria.
Competency Alignment—Skills Management System
When a head coach looses his starting quarterback, a gap is left that is extremely difficult to fill! He must act quickly in an attempt to relax anxious team members, fans and reporters. He might be inclined to sign a rookie QB from another team because time is of the essence. Games must be played and life must go on. However, a knee jerk reaction to fill such a weighty position could cost the team its future.
Can you relate? What is your process for replacing your own star talent? Is your executive team prone to letting politics override competency in re-filling choice positions in your organization?
The number one penalty we assess our clients is trying to put people in boxes before they understand how those boxes will play in the new organization. Dinner meetings are famous for instigating such insane promises. You’ve seen it before: CEO, against the advice of executive team peers, asks Senior VP of Sales to dinner during the midst of complete company reorganization. Before the crème brulee is served, the sales guy is now COO. Can the SVP be effective in the new role? It really doesn’t matter. The process is what’s at fault.
A successful transition management system will not consider who goes in the organization chart boxes until after the what and where of those boxes has been determined. The new organization must address questions like: will we operate by function, as a matrix, or some combination of the two? Will geographies be self-contained, or will they rely on some consolidated corporate unit? Once these (and other) decisions are made, leaders should then figure out how to populate the determined structure.
The MergerCoach Skills Management System (SMS) allows your executive team to evaluate employees’ current competencies, based on job role. After mapping necessary competencies of the new role, SMS facilitates the comparison of the two sets of results to give you a decisive gap analysis to make organizational design decisions.
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