If growth through M&A is part of your strategic plan, be prepared to embrace the integration process with an open mind.
Last week we discussed strategic planning and how it is an integral part of growing the value of your firm. The firms that have undergone the strategic planning process with us have seen massive success. As an example, one of the firms we have helped through this process set a goal of growing from 100 people to 850 people in 10 years. They are well on their way. If you find yourself on either side of the buyer/seller equation, what should you expect and how should you react during the integration phase, post-transaction?
We are big fans of open book management here at Zweig Group. A successful transition requires enthusiastic support from leadership and clear communication. Firm leaders only get one opportunity to do it right. For many individuals, it is a disruptive and potentially traumatic event. It is a lot of work integrating two firms and there can be a lot of tension, uncertainty, and stress. In general, this is not as true for the AEC industry as it is for others, but employees may still fixate on what they cannot control. As with most of life, if you change how you react to M&A, it can be one of the most exciting times in your career, with possibilities for innovation, personal growth, and new opportunities.
What is the ideal reaction? Should you continue working day-to-day and simply hope things work out? Should you get your resume ready and start looking for other jobs? No! The ideal reaction is to embrace the integration process. You have a lot more power than you think, and it may just be the best thing to ever happen in your professional life. You can emerge with more knowledge, visibility, and skills, all of which can be leveraged moving forward.
The results from our recent M&A survey on why sellers are considering M&A show that the number one reason is to increase opportunities for staff. It is up to you to figure out how to make this happen. With very few exceptions, change is inevitable.
The first step is assessing yourself. Where do you fit in with the new combined organization? Determine what your strengths are, where your weaknesses lie, the opportunities within the firm and for the firm, and finally what types of threats you may face. Often, if there are efficiencies to be gained, the first place to look is in fields such as accounting, legal, and HR. If you serve one of these functions, the important thing is to showcase your skills outside of these areas. You may be one of the most critical people to the firm’s success and culture. Figuring out how to communicate that to new leadership will be vital.
After taking a moment for some personal introspection, the next step is to seize the growth opportunities that are presented. There are various ways that firms attempt to integrate, but most will have a transition team that is responsible for a successful integration and realizing “synergies.” If you can get involved with this team, you will have the opportunity to showcase and build your execution, innovation, and collaboration skillset.
The transition team will need to come up with a plan that can be effectively implemented. This process will be closely monitored by leadership and increases the opportunity for second-tier personnel to heighten their visibility. During a period of M&A, innovation and new types of thinking will be at the forefront of everyone’s mind. If you have new ideas, leadership of this new combined entity may be much more available and receptive to the solutions you propose.
Finally, getting involved with the transition will require you to collaborate with both the buying and selling firm. It will help you build your skills communicating and working with people who have different perspectives, cultures, processes, and policies. Collaborative skills are as vital for a principal as they are for an associate. Many people have only worked with one firm their entire career. M&A gives you the opportunity to see what others are doing, implement the good things, and root out the problems.
You need to plan for growth and go after your vision with dogged determination. Strategic planning is vital to every organization. It is disappointing how many firms do not do this. If M&A is a part of your firm’s strategy or is the strategy of a firm that merges with yours, understand that you can set your own trajectory. How you react to change is one of the most important factors in determining your success. If you would like to learn more or have any stories of your own, please let us know.
Phil Keil is a consultant with Zweig Group’s M&A services. Contact him at firstname.lastname@example.org.