For employees and customers alike, the announcement of a merger or acquisition brings uncertainty. Customers may worry about rising price points or changes to their favorite products and services. For employees, the questions are more existential. They may wonder if their roles will be made redundant or transformed beyond recognition at the reorganized company.
It’s a perilous juncture — and one both of us know well.
Our company, Bridgenext, is the result of a February 2024 merger between four separate brands that came together to form one digital consultancy. John’s appointment as CEO was announced at the same time, putting him at the center of initial integration planning and messaging. Roman joined a few months later, in time to execute the integration across customer and employee experience. We’ve also since acquired two additional companies that we’re in the process of integrating into Bridgenext.
The moment a deal is publicly announced is so often destabilizing or confusing — but it doesn’t have to be. In fact, at Bridgenext, we approach each merger as a positive opportunity to reexamine holistic service design across customer and employee experience and emerge with a clearer vision of what we deliver and why.
Ultimately, if you invest in careful integration on the employee side, a coherent and streamlined customer experience follows. However, even our experience has not been without its struggles. Here’s what we learned along the way — and some lessons you can apply to your acquisition or merger.
What are the common risks to customer and employee experience during M&A?
A merger or acquisition can be a catalyst for accelerating business growth, unlocking new efficiencies or enabling entry into new markets. However, any leadership team considering combining their company with another should be wary of a few key risks from a customer and employee experience perspective:
Loss of brand equity. While it makes sense to sunset old brands after an acquisition or merger, you must carefully handle the process to avoid confusion. In managing Bridgenext’s launch, we needed to make sure customers and employees of our legacy brands understood the rationale for the merger and our plans for the transition — before we made any significant moves that affected their experiences. We took time to retire our legacy brand websites to ensure the proper foundation was in place on our new Bridgenext site to support the needs of the previous brands. There’s not a one-size-fits-all timeline for mergers. Each instance requires a thoughtful approach that considers how best to retain the integrity of the last brand without diluting the power of the new combined narrative.
Systems integration challenges. It’s rare for all parties in an acquisition or merger to be at the same point on their digital transformation journeys. This reality can lead to conflict and confusion as different leaders work to level-set which tools and infrastructure the merged company will use and what experiences those systems need to deliver. For example, if a large legacy company still maintaining its data centers acquires a startup built on cloud-native infrastructure, whose infrastructure model should win? As a digital consultancy that specializes in helping companies generate ROI from their existing tech investments, we were especially aware of the importance of getting this piece right. Yet, we still underestimated the nuances of transitioning everyone onto the same tech and security platforms. This is an area where we know we need to get better and dedicate more time to getting right with future acquisitions.
Loss of employee morale. The employee experience side of M&A tends to receive less funding and attention than the customer side, but it’s no less important. We learned from a previous acquisition that dancing around the nitty gritty integration work too much at the beginning of the merger process ad eroded the confidence of our employees in the combined mission of the company. It’s essential to consider the impact that delayed decision-making can have on employee morale. Employees who are left wondering about their fates may lose faith in their company’s direction, become less engaged at work and start to search for new positions. When they leave, they take with them valuable institutional knowledge that could have eased the transition to a newly merged brand. When it came time to bring our four brands together, we knew people were at the core of Bridgenext’s value proposition, so we needed to get employees’ buy-in and bring them along for the ride from the start.
4 ways to strengthen customer and employee experience during M&A
The best way to avoid M&A pitfalls like those just covered is to proactively pursue the upside — especially when it comes to employee experience. Here are the steps we took at Bridgenext to ensure our employees and customers emerged from our merger more engaged and invested than before.
1. Build a story around your new brand.
The first step in getting employees and customers on board with a merger or acquisition is creating a compelling narrative around why it’s happening. At Bridgenext, we worked closely with an outside agency to develop and launch a completely new brand identity with a value proposition that drew on the strengths of all four original companies. This process helped us build a compelling, ownable narrative around investing in and growing the combined business. So when John brought in a few new members to the executive team (including Roman), it felt like a logical expansion and welcome augmentation rather than a threat to replace current leaders.
2. Communicate with your employees, starting at the top.
Speaking of leaders, getting existing executives to buy into a merger or acquisition is vital. At Bridgenext, we invested significant time talking through our vision for the new, combined brand with the heads of all four companies involved in the merger. Once these leaders were bought in, we worked to get the next rung of senior leadership onboard — including flying in the top 50 employees across all four former companies for an in-person meeting.
Once your top leaders are aligned, it’s much easier to communicate a consistent message with rank-and-file employees. Of course, it offers opportunities for all employees to ask questions and provide feedback, for example, at town halls. Even if you can’t communicate every detail of the integration plan yet, it’s essential to give progress updates and keep teams in the loop so they aren’t surprised by the next steps.
3. Remember that technologies and processes reflect your values, too.
Avoiding integration headaches isn’t just about picking through technical specs to find the best tool for every task. You also need to build a shared value system for how to deliver work to end customers. For example, are all teams going to join the same platforms for project management, file-sharing and other organizational needs? If not, what’s the strategic value in keeping workflows separate?
Your vision for your brand during an M&A process trickles down to practical questions like these — and a strategic approach helps avoid sending the wrong message. If possible, map out the intended employee experience across all of the companies involved, plot updates, and then build those improvements into your integration road map. Proactively anticipating technology and process hurdles will help smooth hiccups, reinforce the right values to your employees and enable you to deliver a seamless experience to customers as well.
4. Get anything painful out of your way quickly.
We’re lucky that our merger involved bringing together brands with complementary, but mostly not overlapping, capabilities and capacities. Unfortunately, that’s not always the case. When there are redundancies, and you have to make cuts, it’s important to be purposeful and quick. That way, you can get the problematic part behind you and then focus on your vision for moving forward with the people, systems and processes that remain. Otherwise, by keeping employees in a state of limbo, you create resentment between groups that are supposed to be coming together — making the already difficult task of integration even harder.
The bottom line: Don’t neglect employees during times of transition
If there’s one thing we learned from Bridgenext’s integration process, it’s this: Customer experience is important, but it’s equally vital to invest in clear communication, strategic planning and alignment across internal leadership and staff.
By prioritizing getting employees bought in and addressing their concerns head-on, businesses experiencing a period of transition can mitigate risks and build a stronger, more cohesive brand. Ultimately, when employees feel valued and informed, they’re better equipped to deliver the consistent, high-quality experience customers expect across all stages of integration post-M&A.
Opinions expressed by SmartBrief contributors are their own.
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