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Don’t throw the Executives out with the bathwater!

Don’t throw the Executives out with the bathwater!

The past half-decide we’ve seen lots of movement in the M&A area, whether it be businesses scoping out and acquiring of innovation-vital start-ups or industry giants looking to consolidate their market position. All this buy-sell movement has one important aspect:
consolidation of executive teams.

Here are some issues all companies going through executive team consolidation processes need to think about.

1. Don’t sacrifice talent for comfort: One issue merging organizations face is the blending of management teams. Usually the acquiring company has a tendency to want to keep “its own” in key positions. This is namely on grounds of trust and having a common, proven work history. However, knee-jerk favoritism towards one’s own employees can deprive a newly-formed entity of fresh ideas, access to different know-how and the benefits of long-standing relationships to new business partners.

2. Plan for the longer-term: It’s good to examine and think about your board demographic. One of the two organizations may have older, more experienced executives, while the other may have less diversity. It’s worthwhile to think of all these factors, when developing a post-merger executive team. Look to find C-suite talent that will address multiple issues such as succession-planning, cross-company team leadership, openness to facing new tech challenges and marketing in the Digital Age.

3. Emphasize teamwork: One key element that I find gives maximum benefit to merging companies is placement of “bridge-builders” instead of “bridge-burners.” It’s critical to bear in mind that each merger/acquisition is made for a purpose: access to greater market share, broadening a product portfolio or access to new technologies and intellectual property. Invest in a review of the leadership and team-building skills across both merging companies‘ executive teams and look for talent who can build a stronger, unified organization.