Why Employee Experience Matters In M&A
By Michael Gretczko, principal at Deloitte Consulting LLP and General Manager of ConnectMe
Your software company can drive deal value through a digital workplace.
Deal flow – especially merger and acquisition (M&A) and divestiture activity – has been constant over the last several years—and the outlook for 2018 is even better. In fact, Deloitte’s M&A Trends 2018 report suggests that both the number of deals and the size of the transactions may grow in the coming year.
Despite an abundance of investment opportunities, achieving value through M&A can be a challenge. This is because the employee experience is often neglected. Deloitte’s 2017 Global Human Capital Trends report found that nearly 80 percent of executives surveyed rated employee experience very important or important, while only 22 percent reported that their companies were excellent at building a differentiated employee experience. But creating a positive experience for employees can drive productivity and results – critical components in any successful transaction.
The nature of M&A can make it challenging to connect the acquiring company with acquired employees in a productive way. Business lines may have competing priorities, information is constantly evolving, and technology platforms maybe disjointed. These can contribute to confusion for leaders and employees on both sides of a deal.
Fortunately, companies now have access to HR solutions that can manage the impact of a transaction. HR can play a leading role by leveraging one such tool – a digital workplace – adopting social, mobile, analytics, and cloud technologies to help leaders and employees remain productive and focused on delivering value.
Easing the transition
A lot goes into the planning and execution of an M&A transaction for the leadership teams of both the company being acquired and the acquirer. However, the process does not end once the deal is signed. On the contrary, it can continue for months, even years.
Traditionally, HR is not involved in the early stages of strategy and planning during a transaction, sometimes being brought in right before the announcement. Yet transactions may lead to significant change – requiring employees to relocate, reapply for their jobs (or apply for a new job within the organization), and go through an onboarding process. Meanwhile, employees may be feeling insecure about their own future. Questions like ‘what does this mean for me?,’ ‘how will my role change?,’ and ‘what do I need to do and when do I need to it?’ are all common, and valid, questions that employees ask themselves, for which they may not easily or quickly get answers.
HR can take the lead in this time of transition, implementing digital workplace tools. These solutions can empower employees, enabling them to access all sorts of information specific to this change – from FAQs and details on the transaction and how it may impact them, to HR data and benefits, and onboarding tools for new roles. And the digital solution can automatically send reminders of upcoming changes and deadlines.
This type of portal has become crucial in helping to ensure a smooth transition and improve employees’ morale. It is designed to help employees focus on their job, instead of tedious, confusing paperwork and wondering ‘what may come.’
Improving communications
As noted earlier, keeping employees up to speed is essential during a transaction. Unfortunately, communications aren’t always coordinated across business functions, which can lead to fragmented and ambiguous messages. Additionally, communications often come from a variety of different sources, such as e-mails, checklists, and town halls, creating even greater confusion.
Digital solutions can streamline communications, and help ensure they are timely and targeted. Among the opportunities for a digital workplace to enhance communications:
- User-friendly, proactive communications can be tailored to employees based on content, timing, and need.
- Analytics make it possible to identify the number of people who have read a communication, allowing leadership to determine if additional communications are needed, and the best mechanism for delivering them.
- Employees can navigate to the content they need, when they need it, using digital search functions.
Streamlining transactional tasks
In the midst of a transaction, employees generally need to complete a number of tasks. At the same time, leadership often needs to reconcile employees’ status against activities completed across various spreadsheets owned and maintained by each function. This can be a manual, time-consuming process.
Digital tools can create a personalized experience for employees going through an M&A, by providing one effective platform through which employees can interact with leadership – delivering an unmet need to companies. For example, in a digital environment, organizations can populate a list of activities, which will dynamically appear to employees only when required. In addition, leaders can make it easy for employees to submit paperwork, doing so electronically, on their own time.
Tracking and reporting
Reporting on and analyzing employee interactions is essential to improving the employee experience during a transaction. Organizations can assess the number of employees who have read or searched for information related to a particular topic, or who may be struggling with certain aspects of a transaction – modifications to the business structure and strategy, shifts in culture, and more. In addition, organizations can track employees’ progress against required tasks through dynamic reporting.
Leaders can use this data to make adjustments in their engagement strategy with employees. This can have a big impact, especially as getting employees on-boarded quickly – and happily – is crucial to a successful deal.
The ‘bottom line’
During a transaction, leadership is often focused on ensuring the deal goes well, benefitting customers and other stakeholders. But, arguably, some of the most important stakeholders are an organization’s employees. When employees don’t feel valued, they are more likely to leave, which can result in reduced productivity, and high recruitment and lost time costs.
So getting it right with all employees – helping to ensure they have a positive experience during the transition, with their needs met and their voices heard – will go a long way to impacting the bottom line. And digital technologies can help make that happen, enhancing the employee experience and driving deal value.
About the Author
Michael Gretczko is a principal at Deloitte Consulting LLP and General Manager of ConnectMe which delivers a modern solution for the digital workplace. ConnectMe helps to simplify HR interactions and connects employees how and when they want. Michael has over 16 years of experience in business transformation and focuses on helping clients fundamentally change how they operate. Michael has experience consulting on Digital Solutions, innovation, business strategy, service delivery, process design, enterprise cloud technology and operating model transformation including shared services, and outsourcing. His consulting experience includes helping clients define and change strategy, transform operations, globalize operations, enter new markets, increase employee and customer engagement, reduce costs, and manage with better business insights.