Before an executive or business owner makes a decision on a merger or acquisition there are many steps that need to be considered. These steps, when taken, are a reaction to what’s happening in the business or marketplace at the time, and influence the direction and creation of a company’s strategy. Decreases in share price as well as layoffs and work stoppages are typical reasons why a company will need to rethink or change its strategy. I refer to these reasons as Rumblings.
From my experience, this is typically how employees experience these changes in their company. Rumblings are business indicators or activities that lead an organization to change course and are often the precursor to a merger or acquisition. Rumblings are quiet, low vibrations that, when you hear them, you know something is there, but they are in the distance or not entirely discernible. Rumblings provide us with clues about what’s ahead.
Whether the rumblings are under the hood of your car or in your organization, as an executive or business owner you need to be aware of your how your employees are experiencing them and create a strategy to manage them.
They will occur whether you are working in a public or a private company. Your employees will experience these rumblings as changes in economics, layoffs, rumours, work slow-downs, and the frequent presence of the executive leadership or Board Members/Investors. As you read through each of the rumblings described, consider how these might be taking place in your own organization and what can be done to mitigate them with your employee base.
Regardless of the direction in which you want to take your company, you will be heavily engaged in the planning of these events. While you are doing so, many of the activities will not be visible to your employees and they may perceive the lack of corporate transparency as leadership deception. This deception is not intentional and is often unavoidable.
Leadership Deception – What Executives Can’t Share
Leadership deception in this context is referring specifically to those things that executives or business owners won’t—or even can’t—share about a merger or acquisition.
Keeping your cards close to your chest is imperative in ensuring business survival and growth. The lack of transparency when working on a merger or acquisition is unavoidable and often necessary in the merger and acquisition space. It is done knowingly to maintain shareholder/investor confidence, keep employees in key positions within the company from leaving, and to get through all of the legal and regulatory hoops required for a merger or acquisition to happen.
In addition to those reasons, the story for the “street” has to be carefully crafted, cultivated, and protected to ensure the transaction has the best possible chance for success. Your employees will experience this lack of short-term transparency as a form of deception.
Entering into the deal-making space can be a mutable and ambiguous experience with many twists and turns along the way. Frankly, often executives and business owners don’t know to what degree the level of fallout will be when engaged in a merger or acquisition.
Although executives and business owners can plan and prepare for the deal, it is inevitable that there will always be changes that will need to be addressed and solutions incorporated along the way.