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Communication During the Process of M&a

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Communication during the process of M&A

Mergers and acquisitions provide a great opportunity for growth to the organizations. Together the companies can strive for growth and higher profits using smaller amount of resources. However, it is not easily implemented and many factors should be taken in consideration in order for the merger to be beneficial and successful. Studies show different numbers, but according to Harvard Business Review, 70 to 90% of mergers fail and therefore companies incur losses. There are many wrong business decisions that managers can make during this process, but this paper will be focused on internal communication practices that contribute to the failure of a merger or acquisition and give some techniques that will help to communicate successfully.
Many organizations ignore the people element in the formation of a new organization. Managers are concerned about the profits and new business strategies and often forget about the fact that employees are the key to the overall success and that the achievement of the business goals depends on every single employee. So therefore, it is essential to keep them motivated and engaged in the new environment.
So, what can go wrong and how to make it right?

• Merger or acquisition? The abbreviation M&A does not distinguish the difference between the two components: M and A. It implies that both of them are the same. In fact, the two components are completely different in their nature. Merger means that two companies will be operating as one. Two separate entities, which possibly were competing in the past, will have to stand shoulder to shoulder and operate as one. Both of them will have to play equal parts in their synergy. On the other hand, acquisition implies that the parent company will set the new terms for the target company and will become a leader. Two different approaches...

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