CIPD report identifies the people management policies that bring merger success
People management experts the Chartered Institute of Personnel and Development (CIPD) are today launching a case study-based report on the management of international mergers and acquisitions. It shows that people management policies are critical to bridging the cultural divide between organisations and ensuring the mergerís viability and success. The report is co-sponsored by CIPD, Mercer Human Resource Consulting and PricewaterhouseCoopers Human Resource Services.
The report, HRís Contribution to International Mergers and Acquisitions, also concludes that the nationality of the acquirer has a significant impact on the host organisation and thus underlines the importance of getting the cultural dimensions right. The report highlights five HR policy areas as key to integrating cultures successfully. These include:
* Pay and benefits
* Management selection and development
* Harmonisation and integration of HR practices
* Employee communication
* The pace of change
The report also emphasises the micro steps that HR should take to help leverage any possible deal. For instance, it recommends that a new management team is appointed quickly but fairly whilst dealing with any necessary redundancies humanely as part of a people-centred approach. Other recommendations include setting realistic targets, understanding the rationale of the deal and its external constraints, and ensuring that all costs and reward issues are factored into the deal.
CIPD International Manager Frances Wilson says: ìThe report shows that management and HR need to focus on the people dimension at the earliest stage to ensure that workers do not become alienated by the cultural divide that can exist between organisations. As merger activity looks set to pick up in line with the economic upturn, the report offers some timely guidance to those involved in such activity, including those on the Board.î
Marc Hommel, leader of the HR Transaction Services group at PricewaterhouseCoopers, said: ëîThe findings of this report demonstrate, once again, that the deals with the most successful business outcomes are those where people issues have been identified early and then appropriately addressed. To make a meaningful contribution, the challenge for HR professionals is to be able to demonstrate that they have the skills and expertise to work credibly with business leaders in deal situations. This research is an invaluable tool to those that wish to rise to this challenge.î
Richard Coates, European Partner at Mercer, said: ìIn a newly-merged organisation, the priority should be to identify and retain those individuals and teams with the right skills, and establish clear roles and objectives for them. Experience has shown that the most successful mergers are those where companies devote significant time and attention to the people issues - financial results will then follow.
CIPD report identifies the people management policies that bring merger success
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