Insight article

Facing Acquisition? Take A Bath In The Shark Tank.

The economy is on a rebound, so it is no surprise that many companies are using mergers and acquisitions as an effective way to grow revenues.  As a result, I’ve recently noticed an increase in the number of questions on how to survive these transactions as an employee. To provide some valid advice, I interviewed a few of my clients who have gone through mergers and acquisitions at different levels. While every situation is unique, here are some general tips to help you weather the storm.

Sniff Around

The best thing to do when you first learn about a potential M&A is to gather as much information about WHY, WHO, and WHEN. Time is of the essence because changes are going to be made on-the-fly and you need a plan of action. However, to be effective, it should be built on the most accurate information. It’s a critical time to attend all (even the most boring) meetings, go to lunches and cocktails with key people and don’t be above collecting rumors. Look up all the new names and do maximum research on the new players. Try to get answers to as many of the questions below as possible:

  • What is the primary motivation for the transaction?
  • Is this a technology acquisition play, customer base expansion, streamlining of operations, etc.?
  • What does each entity stand to lose or gain from the transaction?
  • What would the new organization be like? (strategy, leadership, culture, location)
  • What it the timeframe?
  • Where do you potentially see yourself fitting in?

With this information you can attempt to envision a somewhat-accurate picture of what the future organization might look like and who may make up the leadership team. You can begin assessing whether or not there would be a need for someone with your skill set, or will it become obsolete due to redundant resources and a different business strategy. Things are about to get interesting (possibly evil) and you will have to decide if you should:

a)     Fight to stay in your current role

b)     Identify a better option and work on getting that position

c)     Maximize your severance package and get a fresh start

Pick Your Poison

If your goal is to stay in your current role, your first priority is to find out who you would actually report to. In a very short time-frame you will need to figure out their hot buttons and use that information to build yourself up into an ultimate super-hero. “Google” the hell out of them, as well as the competing candidate (if you know who they are) to figure out their philosophies and professional views. Check out both of them and their contacts on LinkedIn, if you have common relationships, use them to collect information (it never hurts to discover some dirt). You can potentially use some of these folks you know in common to build trust with your future boss. Befriend your competition if possible.  And finally schedule a time to meet with your future boss to discuss their goals and vision for your group. This information would help you sell yourself as a candidate and elegantly burry your competition. Now you are as ready as you can be – call your next meeting with your future boss and ask for the job.

Pursuing a better role in the “NewCo” can be tricky. Mergers and acquisitions create a mess, few things are certain and your management staff may know only marginally more than they let on. Therefore, it is not likely that this “better opportunity” is clearly identified or defined by the executive team. You might have to be the one who creates and sells this role to the upper management in the chaos. Another scenario is that the role could be identified for you, but you might have to re-shape it and actually turn it into an opportunity worth pursuing. In both cases it is a hard sell, so be prepared to fail, but it could pay off as a very valuable experience!

Start with getting to know the new leadership and their strategy; this may involve a combination of online research, your colleagues’ alcohol-induced confessions and the good old guessing game. Identify areas where you can  make an  impact which would align with their agenda. If you can get in front of the right people in time and sell it well – you can skip a few steps on the corporate ladder.

Don’t Bend Over

I also learned that when the leadership team “trades horses” (way before the public announcement) a list of “retained” folks they want to keep is made. It’s very possible that you made the list and a position will soon be offered to you. Don’t be in a hurry to accept it. Make sure that it’s an interesting role, with solid visibility which offers the same or better compensation. It is not uncommon for them to offer you some undesirable newly created role and tell you that it is your only way to survive the acquisition.

You are not a toll booth attendant and therefore you shouldn’t view your job as just a source of income, you should look at it as a career-building mechanism. Always stay true to your long-term goals and choose a route that takes you a step closer to reaching them.  With this said, don’t accept a new role just to stay with the company. One of my sources explained to me that these so-called “background” roles are often offered to people in order to avoid having to pay out severance. If you see that you are being offered a role without much substance, you are likely to be pushed out later anyway, but without a package. Even if you do manage to stay in this insignificant role for a few years, the opportunity cost is too high. Chances are it’s not going to look good on your resume nor would it provide you with desired experience.

No matter what your employer offers, you shouldn’t  just let things happen to you. If you are not able to stay in a role that is beneficial to your career, take an exit strategy. It is a great  opportunity to upgrade your job. You would have a solid reason for looking and most-likely a financial cushion of a severance package to be selective. The key to maximizing your severance is to express your desire to stay only turning down an opportunity which is clearly below your skill or pay level. Remember that the whole purpose of a “severance package” is to pacify you and prevent you from litigating the employer for wrongful termination. If you appear too eager to leave, you might lose that leverage.

Please call me directly at 312-674-4524 if this post doesn’t cover your situation and I will try to put you in touch with someone who can help. Good luck!

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