Overcoming Inconsistent Process

Ginger Shelhimer of M&A Partners
By Ginger Shelhimer
Nov 15, 2018

(Fifth in a series of posts about doing HR M&A right. The previous one is Due Diligence: It's Not Just About Liabilities Anymore.)

Transaction readiness is the key to success in any deal, so position your company for success by establishing processes enabled by competent and experienced performers. Companies that do M&A well evaluate not only the identification of targets, due diligence process and integration efforts, but also track post-deal goals, synergies and outcomes. Of course, it is easier to evaluate performance against deal strategy and financial goals than it is to measure goals for culture, adaptation to change and the transitioned employees’ experience during and after the change. But people are often the most critical aspect in deals, and HR can greatly influence the success of the people transition.

In our recent series, How to Avoid Being the Next M&A Horror Story, we focused on HR and its impact on transitions. While not an exhaustive list, there are five mistakes by HR that could absolutely derail a deal. These include: (1) challenges with culture, communication and change; (2) bringing a transaction-focused mindset rather than being transition-focused; (3) having an insufficient structure or HR support model; (4) failing to manage due diligence effectively; and today’s topic, (5) lack of HR process, tools and playbook.

In our experience, several questions arise when implementing playbooks, the primary being, “What is a playbook”? The term “playbook” can reference a variety of different types of documents. For some companies, a playbook is a set of guiding principles on how to approach deals. For others, it’s a detailed project plan document with instructions attached, or it may even be some relevant documents from a past specific deal coupled with knowledge inside the heads of multiple team members!

  • Do all the team members know that a playbook exists?
  • Do they use the playbook? If not, why not?
  • Has there been instruction or a mandate to use the playbook?
  • How robust is your playbook?
  • Is the playbook sufficient to address deal needs during every part of the process?
  • Is the playbook specific enough to meet the needs of different types of deals?
  • Is the playbook overwhelming in the amount of documentation identified and required for use?
  • Does it include repeatable guidelines, maps, templates or processes?
  • Does it address all different functional areas (HR, IT, Finance, etc.) that are part of completing the transaction?
  • Does it document governance or approval processes and paths?
  • Does it provide for successful handovers between various teams working during different stages of a deal?
  • Is your playbook located on a shared site with proper security measures?
  • Is there an identified owner for the playbook, and is that information still current?
  • Is there a process for incorporating lessons learned from deal to deal into the playbook for the benefit of future deals?

One best practice is to have continuity in teams assigned to support deals and to keep them connected to the process. Keeping the same players on the deal throughout all phases leads to a much smoother and informed transition. However, in companies without a playbook, we often find that once someone has worked a deal, they prefer to go back to their “day job” rather than work another deal. Thus, any knowledge or experience gained departs soon after the project. This damages the company’s ability to provide experienced team members on subsequent deals and leads to “reinventing the wheel” on every transaction, which costs more time and resources. It also prevents learning from past mistakes; improving practices; and developing reusable processes, tools and templates for future deals.

If your company does not have a playbook, you create added risk in any acquisition deals you pursue – and even in those you don’t. Turning down a bad deal is as important as lining up a good one. Having a trained team with a solid process helps to inform early go or no-go decisions.

Keep in mind that a playbook can be as simple or complex as dictated by the maturity level, pipeline and needs of the organization. Also know that the lack of a playbook adds unnecessary cost to projects, burdens your resources, increases the time required to complete a deal and creates the risk of poor performance along with unmet goals and objectives.

Creating a playbook, whether simple or robust, is your ultimate tool in reaching deal objectives. Customizing the playbook with guidelines, repeatable processes, maps and plans of activities, identified ownership and governance, customized templates and tools, along with certification and training, is an investment that pays off over multiple deals and decades.

M&A Partners offers advisory, training and support services and brings the experience of building customized playbooks to enable successful deals across multiple companies and industries. Please contact us for more information and support.


Want to learn more from Ginger about getting your HR team ready for M&A? Register for The M&A Leadership Council's The Art of M&A for HR Leaders where she is a featured presenter.

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