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When two become one: Successfully navigating a corporate merger

As the global mergers and acquisitions (M&A) market booms a growing number of companies are faced with the delicate process of merging corporate cultures, environments, teams and benefits propositions. Nicola Britovsek, Director of Human Resources at Sodexo Benefits and Rewards Services weighs in on the secrets of a successful merger.


From an HR perspective, is there a right time for a merger or acquisition (M&A)?

Nicola Britovsek: Mergers and acquisitions can be driven by a number of different factors: growth, efficiencies, innovation and many more. Whatever the driver, bringing two or more companies together needs to be done with care and for the right reasons. Sodexo Benefits & Rewards Services in the UK acquired Motivcom in 2014.

For the legacy Sodexo business, it was the right time to expand the business and Motivcom wanted to leverage our global presence. Both companies had an established infrastructure, excellent products and a strong client base. However, knowledge, creativity, relationships and so much more was held within the ‘human capital’ of each business.

We took the decision to complete the acquisition in 2014 but used an 18 month window to observe, assess and evaluate every team before finalising the new structure and how every one of these strengths could be used. This was a key part of the project for HR.


Even with the perfect timing, a merger can be a delicate process. How can Human Resources help companies successfully come together?

N.B.: Human Resources should be involved from the very beginning of any M&A discussion. People are at the heart of these acquisitions and they need to be represented effectively. When two companies merge, the employees – who may have different backgrounds, working conditions and company cultures – are expected to work together in the future. As the HR mantra goes, ‘to be successful, companies need to take into account the four Cs: connection, control, career and capability’.

From the moment the acquisition is public, people start to think about themselves and their future. Where there are questions, answers will be found. HR has an important role to play in making sure there is an appropriate stream of information, driven by senior management, so that the answers and information circulating are true – not guesswork by the rest of the staff!

This will help every employee feel connected to their leaders and coworkers, new or existing. During major change, employees can feel a dramatic loss of control. By communicating effectively and putting leaders in place who will ensure everyone feels involved in the decision-making process, engagement will remain high.

At the start of our acquisition process we recognised that we had a wealth of talent and ambition amongst our team. We knew that giving everyone a clear career path and well thought through structure was, therefore, top priority. HR plays a heavy role in making sure any role and structure changes are legal, fair and attractive to the people they want to keep.

One of the most exciting parts about a merger or acquisition is taking the best part of the legacy businesses, adapting them to the new company and rolling them out across the board. For us, we focused on ensuring effective change management was in place to facilitate a smoother transition period.

 Studies show that HR involvement is one of the main drivers of a successful M&A deal. In fact, 93% of company executives believed that post-merger issues could be successfully handled if HR teams were involved as early as possible[1].

In your opinion, what would happen if HR teams don’t take an active role?

N.B.: Without HR, companies run the risk of forgetting the people and their voices or assuming what the staff will want. This is the worst outcome as it leads to lack of engagement, motivation and could see staff turnover increase. This can have huge consequences in terms of morale and even business performance. Companies need to provide continuity because they still have clients who require their services and who expect consistency – merger or not.


What role do benefits and rewards have in securing a successful merger?

N.B.: Often when companies merge, employees have different terms and conditions, benefits packages and rewards and recognition elements. If left unchanged, this can lead to an “us” and “them” mentality and employees won’t feel the sense of one company and one direction. That said, it can be a tricky process. While consistency is the goal, we also have to remember that there is not a one size fits all solution. Benefits and rewards need to be tailored to the needs of a business and its people. A truly flexible approach allows employees to have a suite of benefits to choose from that addresses the different demographics of a newly united team.

This way, every employee sees value in the benefits and rewards strategy – and you can’t put a price on that. Why? Because you can’t put a price on the engagement it creates. If you have engaged employees, you will keep them, they will be happier at work and they will be more productive.


Any key takeaways for companies facing a merger?

N.B.: Communication is absolutely critical and should never be taken for granted. In our experience, the best way communicate is through one direct channel with an element of consistency and the same tone of voice. Also, remember that employees are always going to be concerned with “what’s in it for me?” Companies need a comprehensive communications strategy explaining what is happening and why. Yes, change is scary but it can be managed if companies communicate and involve employees every step of the way.


How has Sodexo’s own experience with the merger helped in terms of client relations?

N.B.: We’ve got so much value to add because we’ve been through the challenges and created something special and successful. We can share our insights concerning the risks, opportunities, advantages, and potential pitfalls. Following the merger, our teams worked together really well and our clients feel that when they engage with our people or visit our offices.

Conducting an employee survey to find out what employees value the most about their compensation programs can provide invaluable insight when designing a new and improved benefits package because it’s focused on actual employees’ needs[2].


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