Mergers and acquisitions involving privately held companies entail a number of key legal, business, human resources, intellectual property, and financial issues.
The truth is that, despite a dizzying array of spreadsheets analyzing the financial impact of corporate mergers, the two greatest risks are often overlooked: retaining high-performing employees and holding onto loyal customers.
To successfully navigate all of those, it is important to understand the dynamics and issues that frequently arise and also their solutions, Opines Hirav Shah, Noted Business Strategist, Adviser Cum Astrologer.
When internal cultures clash after a merger, everybody loses, and your best performers are the first to go. Thousands of companies have paid too little attention to establishing a new, unified culture and then watched the brain trust they thought they bought walk out the back door.
Hirav Shah Opines “acquired workers are twice as likely to leave the firm – compared to regular hires with nearly identical profiles who are also hired into the same acquiring firm. Even worse, the departure effect is stronger for the very best employees.” What Shah means is that , your best employees are also your most mobile employees.
When mergers don’t focus enough attention on aligning the cultures of both organizations, the best people leave. The tragedy is that most of this employee attrition can be avoided if merging companies go through the disciplined process of listening to key employees, understanding their values and bringing the best of both cultures together to make the company stronger and more united.
Listen, then unify..This is Hirav Shah’s Mantra.
A simple act of listening is a sign to key employees that their opinions are valued, Tells Shah.
And while retention of employees is essential to the success of any merger, retention of customers is even more critical.
There are few moments when a company’s customers are more at risk of defection than after a merger. Loyal customers value their relationships with the brands they patronize, and they are skeptical that everything will stay the same. Most companies know customers are at risk after a merger, but they don’t know these simple approaches to preserving the value of the brands they acquired.
Evaluate customer brand loyalty. When it comes to transitioning brands after a merger, everyone has an opinion. The acquired business tends to overrate the value of its brand, while the acquiring company often underestimates customer loyalty to the acquired brands. The best way to avoid blunders that can cost millions is to research customer sentiment related to the acquired brands.
Customer loyalty research can cut through the subjectivity of management opinions and provide an objective assessment of brand loyalty. Because disenchanted customers often defect rather than complain, it’s critical to ask what they think about your plans for the acquired brands. Keep communication lines open.
Determine whether the brands represent similar value propositions and similar audiences.
For brands to align well, both the target customer and the value proposition must be aligned. Companies need to determine which acquired brands work well under the parent brand, which need to stay independent and which need time to transition.
“Get things right, strategize and your merger is set up for long-term success”, Says Shah.
Dharma & Corner Stone
Looks like Dharma and CornerStone – Merger as Talent Management Agency, is all set to climb the ladder of success , because of the key people leading it and their past records, Opines Hirav Shah.
If they focus and strategise, they can get “things right”, in Hirav Shah’s words.
With its tremendous contribution to the Indian movie theater for over 40 years, Dharma Productions is now all set to redefine the representation of artists throughout the spectrum of stars and skill from the music market to decipher the smooth chances for them and assist them construct their professions in their particular markets. Emerging the world of this collaboration with Cornerstone, this brand-new skill management firm is called Dharma Cornerstone Agency (DCA).
Dharma Productions has ventured into talent representation and management in partnership with Cornerstone to launch Dharma Cornerstone Agency (DCA)
Over the years, Dharma Productions has actually contributed considerably to the core of this market with unique artists. It has actually raised the ground for various people of enthusiasm, skill and effort and paved a method to more recent heights.
Cornerstone, helmed by Bunty Sajdeh, has actually shown its knowledge in end-to-end skill management for well over years. With its tactical brand name structure abilities right from sales and marketing both digital and standard, to animation, licensing and video gaming, PR and total image management, Cornerstone has actually effectively represented numerous popular sport and home entertainment skills alike.
Carrying forward the very same tradition of Dharma Productions and Cornerstone, Dharma Cornerstone Agency (DCA) intends to be an indomitable powerhouse of skill that will drive co-operations and end up being the criteria for artist management and representation in the nation.
Dharma Cornerstone Agency will intend to be a safe house where experienced professionalism will satisfy existing and modern skill in this age of pop culture to enhance superior material production and availability through movies, recommendations, OTT material, occasions, looks. It will likewise deal with its skill to construct their brand name through their digital/social existence and individual PR.
The purpose of such a Merger revolves around the growth strategy. The Merging has taken place in the company’s efforts to increase market share, geographical outreach, to reduce competition, profit from patents, or even enter new sectors or product lines.
Lastly,Hirav Shah reiterates- “get things right and choose what not to do“.
The essence of strategy is choosing what not to do.