HUMAN RESOURCES MUST BE A TRUE BUSINESS PARTNER
With the vision to improve quality and boost affordability, many standalone healthcare organisations consider merger and acquisition as important part of their business model. However, they fail to realise that the primary reason why mergers and acquisitions do not deliver long-term value is due to lack of a strong cultural-integration between teams.
Immediately after the deal is made, acquired organisations especially its people, undergo a complete transformation. With the systems, processes and programmes underpin, the acquired company’s culture is heavily scrutinised. Gripped with the anxiety of the outcomes, people of the acquired firm are the most affected in any merger and acquisition processes.
Success of any business plan depends on the people who drive and lead the business and their ability to formulate and execute strategy. It is critical to involve HR professionals in the process of merger & acquisition as it has an impact on all the employees.
Analysing and dealing with organisational cultures After the merger and acquisition process, the chances of achieving targeted outcomes increase double-fold when proper planning is done to integrate the two different cultures of the organisations. Integration of these two cultures is not a shortterm task and does not happen immediately. Therefore, the HR leaders of both companies should promptly develop a strategy to help out the companies in accomplishing the synergies. In many cases, smaller acquisitions tend to do better than larger ones because the cultural differences can be easily ironed-out with smooth execution of the HR strategies.
Also, the consolidation in the healthcare sector can either help or hurt patients as the key decision makers in the organisations change. With merger and acquisition on the rise, a planned integration of strategy and merging two cultures can help avoid the risk of economic upheaval.
Role of HR in merger & acquisition
Generally, Human Resource comes into play only after financial rationale deal is confirmed and due diligence is performed with all the documentations. Ideally the Human Resources department of any Organisation should be included right from the very day of the onset of merger discussions. This helps them to prepare a road map for successful integration of people and strategy in advance on the basis of future goals and visions of both the companies. This can be followed post-merger driving away any future possibilities of misunderstandings and differences.
Before putting the merger and acquisition plan into practice the leaders along with the Human Resources should anticipate the structure which is yet to be formed. This is important for the new organisational entity where a proper management team should be put in place to align and guide the organisation towards the established vision. Involvement of HR professionals is indispensable in any merger and acquisition process as they directly deal with the issues pertaining to employees and can suggest amicable solutions and way forward plan for implementation of strategies that can benefit the employees in the long-term.
Bridging the gap with communication
Companies struggle when they fail to define further course of action and maintain a transparent dialogue with the employees of the acquired entity. This can often lead to undesired momentum to sudden strike or unionization by the employees.
Amongst the many variables that healthcare organisations should pay attention before the deal is completed, Human Resources department can act as a catalyst and coach in the success of mergers and accusations in today’s ever-changing healthcare landscape.
Below mentioned are some of the best practices that can be followed by HR during merger and acquisition:
Identify leaders from both the companies for effective implementation, communication and transition of the employees
Provide training to the managers on the nature of change for them to adjust to the new working environment.
Conduct orientation programmes for the employees of the new entity on the Policies, Procedure, Values, Vision & Mission of the new organisation
Update team members on Performance management, Compensation, Benefits and welfare schemes of the organisation.
Conduct regular town hall meetings and team building activities
Arrange regular training sessions for the new employees on particular skills and techniques
Boost confidence of staff
Retain productivity by brushing away the doubts and fears of employees hence maintaining transparency in the organisation
• Work in tandem with department heads to explain the new roles of each employee in a particular department
• Expound the hierarchy structure
of the organisation, post-merger
Elucidate the effects of the merger for the employees of both the organisations and explain them the advantages of mergers.
Importance of involving HR in merger and acquisition process:
Helping employees to cope up with the new changes in the organisation and adapting to the new culture
Framing correct organisational hierarchy structure
Maintaining the productivity by placing of right people at right place and the right job.
Alignment of compensation, benefits and welfare schemes
Relocation of the employees
Compliance of local labour laws
Effective staff communication
Update the new team members of employee benefits.